PARIS — LVMH Moët Hennessy Louis Vuitton’s key fashion and leather goods division broke its losing streak in the second quarter, in a signal that demand for luxury goods is recovering after two years of sluggish sales.
The French luxury goods giant said organic sales for the unit, which includes Louis Vuitton, Dior and Loro Piana, rose 1 percent to 9.01 billion euros in the three months to June 30, following seven consecutive quarters of declines.
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This was in line with analyst estimates, amid mixed results from sector peers that indicate luxury brands are increasingly dependent on a small cohort of ultra-wealthy clients, while aspirational consumers remain squeezed by inflation and geopolitical turmoil.
LVMH benefited from a positive comparison basis, since organic sales of fashion and leather goods dropped 9 percent during the same period a year ago.
The industry bellwether reported group net profit was flat at 5.70 billion euros in the first half of 2026, beating a consensus forecast of 5.22 billion euros in a poll of analysts conducted by Visible Alpha. Profit from recurring operations was down 4 percent to 8.69 billion euros, equating to an operating margin of 22.5 percent.
Overall revenues were flat at 19.52 billion euros in the second quarter, representing a rise of 3 percent in organic terms.
The wines and spirits division continued its recovery with a 5 percent increase in organic sales, while perfumes and cosmetics remained under pressure, registering a 1 percent decline.
The watches and jewelry unit was a bright spot, with organic sales up 11 percent, confirming the strength in hard luxury seen elsewhere. Rival Compagnie Financière Richemont said jewelry sales jumped 24 percent and watch sales were up 8 percent during the same period.
Selective retailing maintained its momentum with a 6 percent increase, after DFS sold its travel retail business in Greater China to China Tourism Group Duty Free during the first quarter. LVMH has also entered into an agreement to sell the Los Angeles and San Francisco airport concessions to Duty Free Americas, and to sell DFS Okinawa to Swiss-based travel retailer Avolta.
The group has been strategically offloading assets as it focuses on brand reboots under new creative directors at Dior, Celine, Fendi and Loewe. LVMH revealed in May it was selling Marc Jacobs to WHP Global, having divested its stakes in Stella McCartney and Off-White over the last two years.
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Inside Louis Vuitton The Place Seoul’s grand opening.Simpson Kim/WWD
“LVMH demonstrated its solidity and effective strategy. Our maisons — which remained focused on ensuring the utmost quality in our products, and several of which are pursuing their creative renewal — continued to inspire dreams and enhance their desirability,” Bernard Arnault, chairman and chief executive officer of LVMH, said in a statement.
“Accelerating growth in the second quarter arose in particular from the success of Jonathan Anderson’s first designs for Christian Dior, the remarkable performance of Louis Vuitton’s exceptional new stores in Beijing and Seoul, and Tiffany and Bulgari’s iconic lines,” he added.
Newness has become crucial in the battle to woo and retain VICs, with the top 0.1 percent now accounting for around 23 percent of global expenditure, according to a recent research note by Bernstein analyst Luca Solca and his team. They estimated that 70 million aspirational consumers have exited the market since 2023.
“Selling more to existing consumers will require sustained relevance and a higher innovation tempo. As the inflow of new middle-class consumers slows, brands must lean more heavily on their installed base of repeat clients and VICs, who already own the iconic essentials and will only part with additional money for genuinely new and compelling products,” it noted.
“This is pushing brands to accelerate innovation, whether through category expansion, product refresh or increased brand investment, to remain differentiated, interesting and culturally relevant,” the Bernstein report said.
In parallel, luxury consumers continue to shift their focus from owned products to lived moments. Sentiment toward experiences is outgrowing tangible goods by 1.5 times so far in 2026, according to the most recent luxury sector report from Bain & Company and Italian luxury association Altagamma.
In response, LVMH is expanding brand reach with cultural experiences.
At the recent Belgian Grand Prix, its Moët Hennessy wines and spirits division joined forces with Formula 1 to launch a new $13,450 dining experience allowing a handful of guests to dine on the circuit with a VIP chef.
Meanwhile, Louis Vuitton is bringing back its tradition of classic car runs with a rally in Italy in September that will culminate at the Autodromo circuit in Monza during the opening of the Italian Grand Prix.
LVMH is the first major French luxury player to report second-quarter results this week. Kering will follow on Tuesday, and Hermès International on Wednesday.
A scene from the Louis Vuitton Italia Classica rally in Tuscany in 1995.Courtesy of Louis Vuitton
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