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LVMH's Weak China Sales Raise Fresh Concerns over Global Luxury Market Recovery
Organic sales rose 1% to €18.28 billion, but LVMH’s fashion and leather goods unit fell 5% as China demand softened.
- On Monday, LVMH reported third-quarter group revenues rose 1 percent to €18.5 billion, though its flagship fashion and leather goods division posted a 5 percent organic sales decline.
- Chief Financial Officer Cecile Cabanis cited a 'macro-led deterioration' in Chinese consumer sentiment as the $350 billion luxury sector remains mired in a three-year slowdown.
- While business activity in China appeared less 'buoyant,' the United States, Europe, and Japan saw 'good growth,' with wines and spirits posting a 6 percent organic sales increase.
- Investors reacted by sending US-listed shares down nearly 3 percent, extending a decline of more than 41 percent this year that pushed LVMH behind L'Oreal as France's most valuable company.
- HSBC downgraded the stock to Hold from Buy last month, lowering its price target to 490 euros as analysts monitor whether Dior and Louis Vuitton collections can stabilize demand.
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The nine-month results of the Parisian group have cast a shadow on the entire sector. While everyone expected a rebound – technical at least, after years of decline, Chinese demand is still in the darkLVMH is getting cold in China and the entire luxury planet is getting febrile. The Parisian group opened the intermediate results season by presenting its figures in the third quarter on Monday. They are not catastrophic at all, with nine-month sal…
·Geneva, Switzerland
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Coverage Details
Total News Sources58
Leaning Left5Leaning Right4Center13Last UpdatedBias Distribution59% Center
Bias Distribution
- 59% of the sources are Center
59% Center
L 23%
C 59%
R 18%
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