LVMH Sales Rise 3% on US Demand, Offset by Weaker European Spending

Key facts

• LVMH reported a 3% increase in overall second-quarter sales to €19.5 billion.
• Demand in the United States was a primary driver of the sales growth.
• The fashion and leather goods division saw 1% organic growth.
• This 1% growth fell short of analyst expectations.
• Weaker spending in Europe was noted, partly due to the Iran war's impact on tourism.

LVMH shares rose 2% after the French luxury giant announced second-quarter sales that met analysts' expectations. The owner of Louis Vuitton, Dior, and Moet & Chandon reported a 3% rise in sales, adjusted for currency fluctuations, to €19.5 billion. Demand in the United States was a primary driver of this growth. However, the company's most profitable division, fashion and leather goods, saw only 1% organic growth, reaching €8.90 billion ($10.12 billion). This figure fell short of analysts' expectations for a 1.7% rise and marks the segment's first quarterly increase in two years. LVMH flagged weaker spending in Europe, citing the impact of the Iran war on tourism. Analysts at RBC noted that meeting full-year expectations hinges on the division's performance despite tougher comparisons in the third quarter. Morningstar analysts stated that LVMH is still lagging peers, though trends are turning slightly more positive.