LVMH Reports Higher Results For Q4 2024

LVMH has just published its results for the fourth quarter of its financial year, and the news is rather encouraging: sales of €23.9 billion are up 1%. The end-of-year festivities helped to revive sales after a mixed period.

Hopes of a recovery in the luxury goods sector thus seem to be taking shape, although it should be remembered that over 2024, the group's net profit fell by 17% to €12.55 billion. Its core business, fashion and leather goods, recorded a slight fall of 1%, remaining in the red, but posting less worrying results than those of the previous quarter (-5%).

Although this growth is still a long way off those of previous years, the results are still better than expected by several financial analysts, such as HSBC, which had forecast a fall in revenues in the fashion and leather goods division of 4% in the fourth quarter on a like-for-like basis and had predicted an overall decline in sales across all divisions of 3%.

Looking at the individual divisions, it can be seen that Wines and Spirits has not yet recovered from its difficulties, posting a decline of 8%. On the other hand, Watches & Jewellery and Selective Retailing proved to be the driving forces this quarter, with growth of 3% and 7% respectively. Cosmetics and fragrances also performed well, with sales up by 2%.

Another noteworthy development was the resurgence of the US market despite a highly uncertain economic climate. Growth in the United States was posted at 3% for the last quarter, compared with 0% for the previous quarter. According to HSBC, the US market will be the primary driver of the luxury goods sector this year. In Asia, it will be interesting to see how the new measures introduced by the Chinese government can revitalise the country's economy. For the moment, LVMH is reporting a 10% decline in sales in Asia-Pacific, except the Japanese market, where revenues are up by 8%.

At the results presentation, LVMH CEO Bernard Arnault said he was optimistic about 2025: ‘While remaining very vigilant in terms of cost management and focusing on the desirability of our creations, we are approaching 2025 with confidence’, he said. Could the billionaire, who was present at Donald Trump's inauguration, allow his group to benefit from the closeness between the Arnault family and the new American president?