French luxury conglomerate LVMH is set to reveal impressive sales figures for the fourth quarter, following the positive earnings reports of its competitors. The ongoing demand for high-end fashion and accessories from pandemic-weary consumers has contributed to this surge in sales. LVMH’s renowned brands, Louis Vuitton and Dior, are expected to lead the way with a projected 16% increase in sales during the crucial holiday period, even at constant exchange rates.

The fashion and leather goods division, which accounts for half of LVMH’s revenues, is primed to cement its dominance in the industry, boasting an estimated market share of 21%. This marks a significant increase from the pre-pandemic market share of 16%, according to UBS forecasts. Furthermore, the division is anticipated to maintain a profit margin of around 40%, placing it among the highest in the luxury industry.

As the largest luxury group globally, LVMH owns an extensive array of brands, including Hennessy cognac and cosmetics retailer Sephora. Throughout the pandemic, the company has strategically bolstered its position in sectors such as jewelry, particularly through its acquisition of Tiffany. The significance of Tiffany within the LVMH portfolio is expected to escalate as the company invests in marketing efforts to rival competitors like Richemont’s Cartier.

LVMH’s outstanding performance follows positive reports from other luxury brands in the sector. Prada, Richemont, Burberry, and Tod’s have all reported sustained demand for high-end goods throughout the previous year. Despite the ongoing impact of limited international travel, which previously drove growth, luxury brands have adapted by focusing on local consumers and expanding their digital channels.

It is projected that LVMH’s sales for the final quarter of the year will reach approximately 18 billion euros, marking a remarkable 17% increase compared to the pre-pandemic levels witnessed in 2019. The outlook for the luxury industry remains positive, as consumers continue to revel in the allure of luxury goods despite the ongoing pandemic.

useful links:
LVMH Official Website
The Business of Fashion