The Louis Vuitton store window in the Mitsukuchi store in Tokyo, Japan, on Friday, April 4, 2025.
Bloomberg Gety pictures
shares LVMH Up to 8 % on Tuesday morning, at some point that lost its position as the largest luxury company in the world to compete Hermes After an unexpected decrease in sales in the first quarter.
LVMH recorded a 3 % decrease on an annual basis in Sales in the first quarter In a commercial update, it was published shortly after the market was closed on Monday, the expectations of the consensus analyst for minor growth expectations.
The results were withdrawn to the bottom of the wider sector in early deals Amid market gains wider. dry The shares decreased by 2.5 %, barbaric 4.4 % decreased while Richmont 1.6 % trading.
A 0.7 % smaller decrease at the Hermès share price saw that the market value of Birkin Pag-Maker exceeds the LVMH degree at one point during the morning trade, according to Reuters. The market value of LVMH last reached 247.1 billion euros ($ 280.6 billion) against Hermes 244.53 billion euros around 09:30 am London time, according to the CNBC account for LSEG data.
The wine and lives in LVMH witnessed a decrease in the most severe revenue in the first quarter, by a 9 % decrease, as it was clarifying the weakest demand in the United States and China for Connac – the famous Brande Group that was It caught in geopolitical tensions.
The main fashion and leather commodities department, which represented 78 % of profit in 2024, slipped 5 %. Watch sales were flat.
Europe was the only region that recorded growth, an increase of 2 % on an organic basis. Asia, with the exception of Japan, decreased by 11 %, and US sales were 3 % lower, while Japan decreased by 1 %.
“There was not a lot of joy in The Luxury Belweether” with sales “in general less than the most conservative purchase expectations,” said Citi Thomas Chauvet and Mahash Mohankumar.
They added that it was difficult to anticipate the improvement of serial revenues in the second and third quarters for LVMH or the luxury sector, while economic uncertainty remained in the United States and global.
Meanwhile, analysts at Jefferies reduced their target price on the arrow to 510 euros ($ 578.62) from 670 euros.
The luxury sector, which depends on global supply chains and demand for American consumers, is Facing a set of opposite winds From US President Donald Trump’s volatile policy.
The effect of customs tariffs
LVMH, which has trademarks including Louis Vuitton, MOëT & Chandon and Hennessy, is the first luxury European company to report the profits of the first quarter since Trump announced-and then a mutual tariff for its global trading partners.
As such, investors are eager to a sign of companies’ front guidance about the potential impact of definitions on the costs of inputs and demand for consumer.
LVMH Cecil Kabannis’s financial manager told the two invitation that the group had not witnessed a “major change in” direction in the first quarter and that it has continued to see strong growth in the past six months.
“It is true that ambitious clients are always more likely to be in danger in less positive and doubtful economic sessions, and they may have some influence in recent weeks, but on categories such as wine, spiritual drinks and beauty,” Kabannis said.
Kabannis refused to comment specifically on prices in the second quarter, but he said that he would take into account the use of goods reactivation as a level to compensate for inflation or moderate fluctuations in currencies.
Luxury brands are expected to be More than other retailers From the immediate impact of definitions, with high -end stickers is usually more able to transfer the added costs to wealthy consumers.
However, analysts have warned that the possibility of an economic shrinkage caused by customs tariffs could burden demand-especially in the United States and major China markets-which leads to an increase in the sector’s recovery from a period of prolonged weakness.
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