LVMH, the multibillion-pound owner of Dior and Louis Vuitton, has reported a drop in revenue in the first half of the year, joining other major fashion brands which are suffering from a slump in demand.
Revenue for the luxury retail brand came in at €41.7bn (£35bn) for the first half of 2024, the firm said today, one per cent down compared to the first half of 2023.
This was below consensus expectations of a three per cent rise.
Net profit was also down 14 per cent at €3.3bn (£2.8bn).
The firm noted the “challenging geopolitical and economic environment” as many other luxury retailers have struggled to match their strong post-pandemic performances in 2022 and 2023.
Despite the dip, Bernard Arnault, chairman and chief executive of LVMH, was upbeat.
“The results for the first half of the year reflect LVMH’s remarkable resilience, backed by the strength of its Maisons and the responsiveness of its teams in a climate of economic and geopolitical uncertainty,” he said.
Shares in the Bernard-Arnault-owned luxury powerhouse – considered a bellweather for the industry – have fallen 5.5 per cent since the start of the year, and about 20 per cent in the past 12 months.
LVMH ballooned during the pandemic. In April 2023, they became the first European company to reach a $500bn (£387bn) market value.
Its marketing budget swelled from around £5bn in 2019 to nearly £8bn in 2023, nearly three times Burberry’s annual sales.
Even in 2023, LVMH reported a net profit of approximately €16bn (£13.45bn) a new record.
However, the fashion giant reported a two per cent fall in revenue for the first quarter of 2024 to €20.7bn (£17.7bn), which the company said was driven by a slowdown in the Asian market, where sales dropped six per cent.