LVMH gives breath back to the luxury sector with an unexpected improvement in its sales and a ‘rise’ in the stock market

The actions of LVMH they rose the most in almost a quarter of a century after the owner of Louis Vuitton and Christian Dior unexpectedly register a growth in salessuggesting that the decline in demand for luxury goods is beginning to moderate. The shares rose as much as 14% in Paristhe largest intraday increase since September 2001. LVMH, considered a key barometer of the sectoralso boosted other luxury stocks across Europe and beyond.

Although the third quarter revenue of LVMH increased by only one 1% in organic termsthat growth put an end to two quarters of falls and aroused optimism that the demand from Chinaa historic engine of growth, could finally be making a comeback. All company divisions beat analyst estimatesand the region that includes China contributed to growth for the first time this year.

“The pace of recovery, coming from all regions, is encouraging and portends a return to growth next year and beyond,” said the JPMorgan analyst. Chiara Battistini in a note. The results boosted the shares of other companies in the sector, from Kering SA (owner of Gucci), which rose to a 8.8% in Parisuntil Hermes International and the one listed in Hong Kong Prada SpA. Investors will get more information on the state of demand, including from China, when Kering and Hermes present their results next week.

The LVMH sales in the region that includes China increased a 2% last quarterafter having fallen a 9% in the first half of the yearthe company reported on Tuesday. The group is watching encouraging signs of demand in the country, said the financial director Cecile Cabanis to analysts during a call.

The Morningstar analyst Jelena Sokolova commented by email that he sees additional recovery potential in Chinawhere consumers still “They maintain a large volume of savings accumulated after Covid“. In USALVMH sales increased by 3% in the quarter, while the income in Europe they fell a 2%as American tourists spent less on luxury items due to the weaker dollar. Recovery with Champagne

The wine and spirits division from LVMH, which wore two and a half years of declining incomerecorded growth, driven by the Champagne replenishment in the US and the rosé wine sales. Cabanis warned that the comparison base will be more difficult in the fourth quarter that in the third, although he pointed out that in 2026 it will be easier.

Despite the recent slowdown, the largest luxury group in the worldled by billionaire Bernard Arnault, has continued to invest. At the beginning of this year, Louis Vuitton launched its makeup linewith €140 lipsticks that helped attract more customers to storesCabanis explained. In Shanghaithe flagship brand inaugurated a ship-shaped main storecall The Louiswhich has attracted crowds and generated great attention, added the financial director.

LVMH has also made changes in its main brandsincluded Christian Dior Couture. This year he named Jonathan Anderson as new designerresponsible for women’s fashion, haute couture and men’s fashion. The former creative director of Loewe presented his first women’s fashion show this month in Paris. Their new men’s designs will hit stores in Januaryand the feminine ones from second trimester. Meanwhile, the brand fendi of LVMH named the former Dior womenswear designer, Maria Grazia Chiurilike his new creative directorthe firm reported on Tuesday. Chiuri will present his first collection in Milan in February.