Editor’s Note
LVMH, the world’s largest luxury group, is initiating a workforce reduction within its Moët Hennessy wines and spirits division, citing business challenges. This move highlights the pressures facing even the most resilient sectors of the luxury market.
The luxury giant LVMH is starting to wield the scissors in the face of declining business. The group led by Bernard Arnault is beginning adjustments with one of its worst-performing divisions: wines and spirits. According to the Financial Times, LVMH will cut 10% of the workforce at Moët Hennessy.
Specifically, the division has internally announced the dismissal of around 1,200 employees through a communication from the division’s CEO, Jean-Jacques Guiony. Without a disclosed timeline for the layoffs, the group’s goal is for Moët Hennessy’s workforce to return to 2019 levels.
The alcoholic beverages division, which since last February has had Alexandre Arnault (one of Bernard Arnault’s sons) as co-CEO, was the worst performer in the first quarter of 2025, with an 8% sales decline. This compares to a 4% decline in the fashion division, stagnation in perfumes and cosmetics, and 1% growth in the watches and jewelry division.
Furthermore, the wines and spirits division, the group’s fifth most important business by revenue, could be one of the most affected if the threat of tariffs by US President Donald Trump is implemented. The area is also being impacted by changing consumption habits among younger generations.
LVMH, owner of luxury brands like Louis Vuitton, Christian Dior, and Loewe, concluded the first quarter of the fiscal year with a 2% contraction in revenue, to 20.311 billion euros. This contrasts with the 20.694 billion euros recorded in the same period a year earlier. Analysts had expected a sales increase in the first quarter.
By region, the US market experienced a “slight decline, despite good performance from the fashion and leather goods divisions, as well as watches and jewelry.” Japan suffered a drop compared to Q1 2024, a period when the region experienced a strong rebound in spending by Chinese tourists. Meanwhile, in the rest of Asia, trends remained in line with those recorded a year earlier. Europe, finally, maintained positive growth at constant exchange rates and scope.