In this edition of the Glossy+ Research Briefing, we analyze half-year financial results from luxury groups LVMH and Kering.
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The luxury market is struggling this year
Financial results from LVMH and Kering for the first half of 2024 show both companies are down compared to last year. LVMH reported a 1% decrease in revenue compared to the same period last year, and Kering reported an 11% drop. Decreased consumer demand in Asia, especially China, the second-largest market for luxury goods, played a large role in weakened revenue results for both groups.
The China market has in recent years become the main revenue grower for luxury groups, but this year both LVMH and Kering have struggled in this market. LVMH underperformed in all Asian markets except Japan this first half of 2024. The company reported “exceptional growth” in Japan across the first half of the year, “in particular from purchases made by Chinese travelers.” Kering noted a “continuing marked decrease in Asia-Pacific” sales at flagship brand Gucci, which experienced an 18% drop in reported revenue.
First-half results for Kering were largely driven by Kering Eyewear and Bottega Veneta, the only Kering segments that showed a revenue increase this year compared to last. Yves Saint Laurent experienced not as heavy of a drop as Gucci, but still showed a 7% revenue decrease in the first half of the year.
LVMH’s results were driven by the selective retailing, perfumes and leather goods categories. LVMH’s wine and spirits division experienced the biggest financial hit, reporting a 9% decrease in revenue. Watches and jewelry also experienced a 3% dip compared to last year.
