Luxury conglomerate LVMH said quarterly revenue increased modestly as higher spending in the United States helped offset weaker customer activity in Europe and the Gulf region amid the Iran war. The group, which owns Louis Vuitton, Dior and Bulgari, recorded second-quarter sales of €19.5 billion, equivalent to $22.2 billion, representing a 3% rise once currency effects were stripped out, according to Visible Alpha.
Management singled out the U.S. market as the primary growth engine in the quarter. LVMH reported U.S. sales up 6% in the second quarter, following a 3% uplift in the first three months of the year. The company said European sales were flat in the quarter, stabilising after an earlier decline in the first quarter that it attributed in part to the impact of the Middle East conflict on tourism and regional demand.
The update marked LVMH as the first of the major luxury houses to publish first-half results. Despite the headline sales increase, the company’s performance produced mixed signals for investors hoping the wider luxury sector was exiting a prolonged slowdown.
Division performance and operating metrics
LVMH’s fashion and leather goods division, the group’s main profit contributor, posted 1% organic growth in the quarter. That reading was the division’s first quarterly gain in two years but missed analysts’ expectations of a 1.7% rise. LVMH stated that the Iran war reduced growth within the division by one percentage point. The company also noted Dior was picking up momentum under its new creative director, Jonathan Anderson.
For the first half of the year, LVMH reported organic sales up 2%, while reported sales fell 3% to €38.6 billion. Profits from current operations for the six-month period declined 4% to €8.7 billion. The group said its operating margin remained broadly stable at 22.5%.
Market reaction and context
Shares of the French group, which is controlled by billionaire Bernard Arnault, have declined 28% since the start of the year, leaving LVMH among the weakest large-cap performers in Europe year to date. The company did not provide forward-looking guidance in this release beyond the published results.
Currency conversion included in the report noted an exchange rate of $1 = 0.8792 euros.
As the first major luxury house to report half-year numbers, LVMH’s results highlighted the uneven recovery within global luxury markets: clear resilience in the United States alongside pressure in Europe and Gulf states related to geopolitical developments.