Editor’s Note
The luxury market is showing clear signs of divergence. While industry giants like LVMH and Kering face headwinds, other players such as Richemont and Brunello Cucinelli are posting robust growth. This article examines the shifting dynamics and what they reveal about changing consumer preferences.
LVMH and Kering falter while Richemont and Brunello Cucinelli rise.
Luxury conglomerate LVMH reported declines in both revenue and profit for the 2024 fiscal year. Companies like Richemont and Brunello Cucinelli posted strong results, showing a mixed performance across the luxury sector.
LVMH announced weak results for the 2024 fiscal year.
LVMH’s annual revenue for the year was €84.7 billion (approximately KRW 127.2126 trillion), a 2% decrease compared to 2023. Operating profit fell 14% to €19.6 billion (approximately KRW 29.4376 trillion), and net profit attributable to shareholders dropped 17% to €12.5 billion (approximately KRW 18.774 trillion). Following the earnings announcement on the 29th, LVMH’s stock price fell by about 5%.
Annual revenue for the Fashion & Leather Goods division, which includes brands like Louis Vuitton, Christian Dior, Loewe, Givenchy, and Celine, was €41.1 billion (approximately KRW 61.7289 trillion), a 3% decrease year-on-year. Revenue in the Wines & Spirits division decreased by 11% to €5.9 billion (approximately KRW 8.8613 trillion), while revenue in the Watches & Jewelry division fell 3% to €10.6 billion (approximately KRW 15.9203 trillion).
In contrast, the Perfumes & Cosmetics business grew by 2%, reaching €8.4 billion (approximately KRW 12.6161 trillion). Revenue for the Selective Retailing division, which includes DFS and Sephora, also grew by 2% to €18.3 billion (approximately KRW 27.4851 trillion).
On the other hand, Richemont, the parent company of Cartier, reported a 10% increase in sales for the third quarter ending December 31, 2024. Brunello Cucinelli’s 2024 revenue grew by 12%. British brand Burberry’s revenue for the three months to last December fell by 4%, which was better than analysts’ forecast of a 12% decline. Burberry’s stock price surged by up to 16% immediately after the announcement. Meanwhile, Kering, owner of Gucci, suffered a 5.9% stock price crash due to its slow sales recovery.