LVMH Shares Dip Despite Q4 Sales Beat
Paris, France - Shares of luxury conglomerate LVMH declined on Wednesday following its end-of-year report, which fell short of investors' expectations for a robust rebound.
LVMH reported a 1% increase in fourth-quarter sales, exceeding forecasts. However, its margins were impacted by non-recurring events, increased staff expenses, and an employee share scheme.
In morning trading, LVMH shares dropped 5.5%, while Gucci-owner Kering slumped 7.2%. Hermes, known for its affluent clientele, experienced a modest decline of 1%.
LVMH's fashion and leather division, home to brands like Louis Vuitton and Dior, reported sales approximately 2% above expectations. However, analysts remain cautious, suggesting that this performance may not signal a definitive turning point.
The luxury sector has faced sluggish sales in recent years, with Bain & Company estimating a 2% decline in 2024. However, recent positive results from companies like Richemont and Burberry raised hopes of a sector recovery.
Analysts at Deutsche Bank believe that while LVMH's results challenge the notion of universal improvement in the luxury sector, they still indicate a faster recovery pace than anticipated.
Luxury shares have been volatile since the post-pandemic boom, but have rallied since the start of 2025, with Richemont and LVMH up 25% and 18%, respectively.