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Luxury fashion brand LVMH (MC.PA) — whose umbrella of brands includes Christian Dior, Fendi, Marc Jacobs, and Louis Vuitton — saw sales drop tied to cooling handbag sales in China. Market Domination anchors Julie Hyman and Josh Lipton comment on LVMH's relationship with China's luxury consumer market.
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This post was written by Luke Carberry Mogan.
Let's talk fashion. LVMH has sales of fashion and leather goods falling for the first time since the pandemic with the luxury giant getting hammered by a slump in demand from Chinese consumers, in particular whose appetite for high-end purchases appears to finally be slowing down. LVMH owns 75 luxury brands, spanning fashion, jewelry, hotels, and spirits. All of the group's main units missed analyst estimates in the third quarter. And we saw the shares fall, of course. They're mainly traded in France, but they do trade here in the US a bit as well. You know, we've been talking a lot about what's been going on in China, the attempted stimulus there. Um, and LVMH, for a time, was the most valuable company in Europe, but it has seen a little bit rockier performance.
And you have Chinese consumers, we know, we've talked about this kind of tighten spending on high-end purchases. Organic sales in the region that includes China fell 16% in the quarter at LVMH. That was more than estimated. Sales in Japan, by the way, by the way, also worse than the street was looking for.