Editor’s Note
This article discusses LVMH’s latest financial results, highlighting a resilient overall performance despite notable declines in its core fashion and wine & spirits divisions.
Global luxury leader LVMH (LVMUY) released its latest financial report, demonstrating resilience in its fourth-quarter revenue performance despite facing challenges from geopolitical and economic environments. Although sales in the core fashion & leather goods, wines & spirits, and perfumes & cosmetics segments were weak, putting pressure on the stock price, robust demand in the watches & jewelry and selective retail divisions helped the group’s overall performance exceed pessimistic market expectations.
Financial data shows that organic sales for Q4 2025 grew by 1% against the trend, surpassing analysts’ initial expectation of a 0.42% decline. While total revenue fell 5.1% year-on-year to €22.72 billion, it still exceeded the market consensus of €22.59 billion, indicating that this Paris-based conglomerate retains a certain degree of defensive capability amid headwinds.
The wines & spirits segment performed the weakest, with sales plummeting 9%, far below the market’s estimated 1.13% decline. Additionally, the perfumes & cosmetics segment unexpectedly declined by 1%, missing analysts’ initial expectation of 2.18% growth. The weakness in these core businesses has been a major factor dragging down LVMH’s stock price.
In contrast to the sluggishness of the core businesses, the watches & jewelry division delivered an impressive performance, with sales growing 8%, significantly beating the market’s expectation of 0.67% growth. This indicates that high-end hard luxury goods still maintain stable collection and consumption demand in the current market environment.
The “selective retail” division, which includes Sephora, also performed strongly, with its organic sales growth rate reaching more than double analysts’ expectations. This part of the business covers well-known channels such as Le Bon Marché Rive Gauche and has become a crucial pillar supporting the group’s revenue.
From a geographical perspective, global consumption momentum shows a mixed picture. The company noted that demand in the European market declined in the second half of the year, while the US market regained growth momentum, indicating relatively stable purchasing power among American consumers.
It is worth noting that demand in the Japanese market saw a significant pullback after the tourism-driven consumption boom in 2024 fueled by the weak yen. This regional performance volatility reflects the direct impact of currency factors and travel trends on luxury goods sales.
For the full year 2025, LVMH’s total revenue was €80.8 billion, down 4.6% from the previous year. Recurring operating income fell 9.3% to €17.15 billion, in line with market expectations.
Despite profit pressures, the company’s operating cash flow capability remains strong. Operating free cash flow grew by 8%, reaching a level exceeding €11.3 billion. Management emphasized that despite global turbulence, the group has maintained good resilience and innovation momentum. Regarding the stock price, the shares closed slightly higher on the Paris stock exchange but fell 1.7% in after-hours trading in the US.
