Editor’s Note
Hermès’ latest earnings report underscores the brand’s resilience, with Q2 revenue growth of 9% exceeding expectations despite global economic headwinds. This performance highlights the enduring strength of ultra-luxury demand in uncertain times.
On July 30 (Paris local time), Hermès International announced its financial results for the first half of 2025, demonstrating continued robust growth despite widespread global economic uncertainty. Second-quarter revenue reached €3.9 billion, a 9% increase year-on-year at constant exchange rates. This result slightly exceeded analyst expectations, highlighting the brand’s unwavering value and stable demand in the global market.
For the first half (January-June), revenue was €8.0 billion, an 8% increase at constant exchange rates and a 7% increase at actual exchange rates. Operating profit was €3.3 billion (41.4% of revenue), a 6% increase year-on-year. Net profit, however, decreased to €2.2 billion from €2.4 billion in the same period last year, impacted by a special tax on large corporations in France. Excluding this effect, net profit would have been €2.5 billion, showing a 6% year-on-year increase.
By region, the Japanese market performed particularly well, reaching €392 million in the second quarter, a 14.7% increase. This stands in contrast to LVMH, which recorded a revenue decline in Japan during the same period. Furthermore, the overall Asian market (excluding Japan), including China, grew by 5.3% in Q2. Despite prevailing economic uncertainty, Hermès maintained solid demand through its value-focused strategy.
The American market also maintained double-digit growth, recording a 12.3% increase to €760 million. A price adjustment implemented in the US in early May partially offset currency effects. The company is closely monitoring the upcoming implementation of tariffs (baseline 15%) under the new trade framework agreed between the US and the EU.
By product category, the Leather Goods and Saddlery sector, with a 14.8% increase to €1.76 billion, led Hermès’ growth. In addition to iconic bags like Kelly and Birkin, new models such as “Faubourg Express” and “P’tit Arçon” also performed well. The company plans to continue opening four leather workshops per year in France, further strengthening production capacity.
On the other hand, a slowdown is evident in entry-level product categories such as belts, costume jewelry, scarves, and perfumes. The Ready-to-Wear and Accessories sector saw a modest 3.8% increase, while Silk and Textiles grew only 2.2%, attributed to weaker demand for accessories. The Perfume and Beauty sector declined by 7.2%, and the Watches sector fell by 5.5%, though the expansion plan for the watchmaking facility in Noirmont, Switzerland is progressing, with a medium-to-long-term recovery expected.
This period also saw the completion of store renovations in Taiwan and Macau, with operations resuming. Furthermore, major renovations in Beijing and Dubai, as well as new store openings in Scottsdale and Nashville (USA), and Shenzhen and Guangzhou (China) are planned. Full-year investment is expected to exceed €1 billion, focusing on strengthening digital infrastructure, logistics, and upstream processes for textiles, homeware, and fragrances.
Recently, an “original Birkin bag” owned by the late Jane Birkin was auctioned at Sotheby’s in Paris for €8.6 million (approximately ¥1.47 billion) by the Japanese company Valuence Japan Inc., generating significant buzz.
Regarding this, CEO Axel Dumas stated clearly:
emphasizing the company’s consistent pricing strategy.