French luxury conglomerate LVMH is continuing to manage softened global demand for personal luxury goods.
In the first quarter of 2024, revenues slipped 2 percent year-over-year (y-o-y) on a reported basis. Leaders at the luxury giant cite inflation and luxury spenders leaning toward the experiential among the factors impacting its brands.
Leather letdown
In Q1, LVMH brought in 20.7 billion euros in revenue, or $22 billion at current exchange. During the same period in 2023, that figure landed at 21 billion euros, or $22.4 billion.
Last quarter, wines and spirits ranked last in terms of revenue by business group but experienced the largest losses of any LVMH category. Sales decreased 16 percent y-o-y.
Watches and jewelry division sales fell 5 percent y-o-y, yielding the group 2.5 billion euros during the quarter, or $2.6 billion at current exchange.
Sales from fashion and leather goods, its highest-grossing category, also calmed, dipping 2 percent compared to Q1 2023.
Members of LVMH's beauty portfolio have shown stronger growth potential over the past few months, bringing in 2.2 billion euros, or $2.3 billion at current exchange. This marks a 3 percent rise in revenue y-o-y.
The group has been shifting toward increasingly experiential ventures, launching 22 Montaigne Entertainment in the first quarter of 2024. Image credit: LVMH
Selective retailing sales rose 5 percent compared to the same quarter last year. Category leaders, including beauty retailer Sephora and travel retailer DFS, helped drive 4.2 billion euros, or $4.4 billion, for its parent company, making it LVMH’s top grower at the start of the year.
Many luxury groups are on similar uphill earnings climbs.
The past few weeks have yielded early profit warnings from the likes of British fashion label Burberry (see story) and French luxury conglomerate Kering (see story).
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