After a weak first half of the year, the French luxury goods group LVMH regained its footing in the third quarter. While business in the highest-selling division, fashion and leather goods, did not decline quite as much as experts had feared, all other divisions recorded increases. The news caused a sharp jump in prices on the stock market on Wednesday morning.
The shares of the Eurostoxx 50 heavyweight rose in price by more than twelve percent at the top of the index in the morning. But everything else has gone well for the shares in the stock market year 2025 so far – until the evening before, a double-digit price loss had accumulated since the turn of the year. This is now melting to just under six percent due to the current profits.
Meanwhile, analyst Piral Dadhania from Canadian bank RBC praised the French results, which he described as a “step in the right direction”. The expert raised his price target and reiterated his positive recommendation.
Industry expert James Grzinic from Jefferies reported that there was also a more optimistic mood among management at the analyst conference regarding the figures. Nevertheless, LVMH has remained cautious about the future outlook for the time being, citing, among other things, the increasing impact of exchange rates in the second half of the year, he wrote. In addition, the volumes of fashion and leather goods would have to grow again in order to prevent a decline in margins.
In the third quarter, group sales increased organically – i.e. apart from currency and portfolio effects – by one percent, as the company announced on Tuesday evening in Paris. However, experts had expected an average decline of 0.7 percent based on constant business and currencies. LVMH traditionally does not report any profit figures for the third quarter.
Almost all divisions proved to be growth drivers in the three months. In the wine and spirits business, for example, LVMH benefited from increasing demand for champagne and wines, particularly rosé from Provence. The group was thus able to more than compensate for continued sluggish cognac sales – but this business will continue to be burdened by the US-Chinese trade dispute.
Meanwhile, new fragrances boosted growth in the perfumes and cosmetics business, and sales of luxury watches and jewelry also grew stronger in the third quarter. In addition, the downward momentum slowed significantly in the important fashion and leather division, which includes well-known luxury brands such as Louis Vuitton, Christian Dior, Fendi and Céline.
However, the weak first half of the year, in which LVMH suffered from weak demand in almost all divisions, has not yet been compensated for: after nine months, there is still an organic sales decline for the entire group of two percent to around 58.1 billion euros. Given unfavorable exchange rates, the overall decline was even four percent.