Latest news with #Cabanis
Time of India
5 days ago
- Business
- Time of India
LVMH sales weaker than expected as luxury sector awaits US trade deal
Luxury bellwether LVMH reported lower than expected quarterly sales on Thursday, with its core fashion and leather division losing further ground as the sector awaits an easing of trade tensions between Europe and the U.S. France-based LVMH, which owns over 70 brands ranging from handbags, high-end fashion and watches to spirits and hotels, has traditionally drawn on its size and geographical footprint to maximize profits and withstand headwinds. Yet the group is struggling to shake off consumer fatigue and reignite desire for luxury items. Sales for the second quarter to the end of June were down 4% to 19.5 billion euros ($22.95 billion), falling short of a consensus forecast for a 3% decline compiled by Visible Alpha, cited by UBS. Sales at the group's fashion and leather division, accounting for the bulk of profits, were down 9%, below expectations for a 6% drop. Chief Financial Officer Cecile Cabanis said on a call she was still "rather confident" about the rest of the year as the group expected trade talks between the EU and the Trump administration to deliver good news soon. Asked how LVMH would view a potential general tariff rate of 15% anticipated for exports to the United States, Cabanis said that would be an "overall good outcome for the general mood of our clients". With the exception of wines and spirits, some of LVMH's labels still have room to draw on their pricing power to mitigate the tariff impact, she said. In China, where a real estate crisis has dampened appetite for luxury goods , the group saw some improvement, Cabanis said, adding that the success of Louis Vuitton 's new ship-shaped store in Shanghai demonstrated the brand still had the clout to attract worldwide attention. Most luxury sector analysts still view the extended downturn that followed a post-pandemic boom as cyclical, induced in part by the prolonged slump in China, bouts of inflation and a yet unresolved trade dispute with the United States. But after two years of slowing sales following a post-pandemic boom, unease about the health of the industry is growing and high-end labels are scrambling to revitalise their offer. Consultancy Bain expects sales of luxury goods worldwide to fall between 2% and 5% this year after a 1% drop last year. LVMH has recently changed designers at Dior, Celine, Givenchy and Loewe, but they will need time to make their mark.
Forbes
24-07-2025
- Business
- Forbes
LVMH Sales Fall But Luxury Conglomerate Outperforms Luxury Forecasts
Luxury conglomerate LVMH reported a decline in sales for the first half of 2025, as billionaire CEO Bernard Arnault announced plans to open a second factory in Texas amid concerns about how the luxury sector will navigate President Donald Trump's tariffs. CEO of LVMH Holding Company, Antoine Arnault speaks during a meeting after LVMH was named as final ... More premium sponsor of 2024 Paris Olympics, in Paris on July 24, 2023. (Photo by JULIEN DE ROSA / AFP) (Photo by JULIEN DE ROSA/AFP via Getty Images) AFP via Getty Images The luxury conglomerate posted $22.95 billion (€19.5 B) in sales for Q2, in line with analyst expectations. While analysts predicted a 7.02% decline in sales growth, LVMH's second-quarter revenue outperformed expectations, with sales only down 3%. The firm is projected to earn $26.06 billion (€22.15B) this fiscal year. A mild slowdown in sales and uncertainty in Q1 was expected to continue into the second quarter, according to Morningstar equity analyst Jelena Sokolova, 'with no recovery or slowdown for these luxury players.' Cécile Cabanis, the firm's CFO, revealed that the wine and spirits division is experiencing an ongoing restructuring, adding the group does not expect to see significant sales growth in the sector until the second half of 2026. Wine & Spirits and fashion & leather goods divisions both experienced a 7% decline in revenue, due to continued inflation. Cabanis cited Japan's falling tourist economy as one of the main factors in the decline of fashion & leather goods sales. Although LVMH made no direct comment on Trump's tariffs, Cabanis said selective retailing helped maintain the market in the U.S., namely through Sephora. Tangent Loro Piana, which has seen a resurgence in recent years thanks to the 'quiet luxury' trend, was recently put under court administration in Italy for a year because of alleged worker exploitation within its supply chain. According to reports, investigators found workers were forced to work up to 90 hours a week, seven days a week and made less than $5 per hour. Cabanis said Thursday the firm had cut ties with that supplier. LVMH acquired 80% of Loro Piana for $2.57 billion in 2013. LVMH has three factories within the U.S., two in California and one in Texas. Reports say the Texas factory is one of Louis Vuitton's worst performing factories. Donald Trump attended the ribbon cutting for this Texas factory in 2019 with the expectation the factory would create 1,000 jobs over a five year period. However, reports state the headcount could be as low as 300. LVMH received a host of tax breaks from Johnson County, where the Texas factory resides, including a 10-year 75% property tax cut, saving the company an estimated $29 million. Forbes estimates LVMH Chairman and CEO Bernard Arnault and family to be worth $146 billion, making him the richest person in Europe and eighth richest in the world as of Thursday. Key Background The luxury sector faced a slowdown in 2024 due to a loss in consumer confidence caused by economic uncertainty and a shift in spending patterns. However, LVMH still dominated the global luxury market with nearly a quarter of market share last year. Investors were also watching as consumers in Asia have driven sales, boosting it to the top buying market, accounting for 37% of regional revenue in 2024. Moët Hennessy has recently been the weakest performing division within LVMH. It experienced a 36% drop in operational profits in 2024 and sales revenue down 9% in 2025. Alexandre Arnault, Bernard Arnault's son, began heading the division in February 2025 in a bid to target younger consumers, and cut the sector's workforce by 10% this May. His appointment comes after success in rejuvenating Tiffany and Rimowa through high profile celebrity endorsements and collaborations.
Fashion Network
24-07-2025
- Business
- Fashion Network
LVMH sales weaker than expected as luxury sector awaits US trade deal
Luxury bellwether LVMH reported lower than expected quarterly sales on Thursday, with its core fashion and leather division losing further ground as the sector awaits an easing of trade tensions between Europe and the US. France-based LVMH, which owns over 70 brands ranging from handbags, high-end fashion and watches to spirits and hotels, has traditionally drawn on its size and geographical footprint to maximise profits and withstand headwinds. Yet the group is struggling to shake off consumer fatigue and reignite desire for luxury items. Sales for the second quarter to the end of June were down 4% to 19.5 billion euros (22.95 billion dollars), falling short of a consensus forecast for a 3% decline compiled by Visible Alpha, cited by UBS. Sales at the group's fashion and leather division, accounting for the bulk of profits, were down 9%, below expectations for a 6% drop. Chief Financial Officer Cecile Cabanis said on a call she was still "rather confident" about the rest of the year as the group expected trade talks between the EU and the Trump administration to deliver good news soon. Asked how LVMH would view a potential general tariff rate of 15% anticipated for exports to the United States, Cabanis said that would be an "overall good outcome for the general mood of our clients". With the exception of wines and spirits, some of LVMH's labels still have room to draw on their pricing power to mitigate the tariff impact, she said. In China, where a real estate crisis has dampened appetite for luxury goods, the group saw some improvement, Cabanis said, adding that the success of Louis Vuitton 's new ship-shaped store in Shanghai demonstrated the brand still had the clout to attract worldwide attention. Most luxury sector analysts still view the extended downturn that followed a post-pandemic boom as cyclical, induced in part by the prolonged slump in China, bouts of inflation and a yet unresolved trade dispute with the United States. But after two years of slowing sales following a post-pandemic boom, unease about the health of the industry is growing and high-end labels are scrambling to revitalise their offer. Consultancy Bain expects sales of luxury goods worldwide to fall between 2% and 5% this year after a 1% drop last year. LVMH has recently changed designers at Dior, Celine, Givenchy and Loewe, but they will need time to make their mark.
Fashion Network
24-07-2025
- Business
- Fashion Network
LVMH sales weaker than expected as luxury sector awaits US trade deal
Luxury bellwether LVMH reported lower than expected quarterly sales on Thursday, with its core fashion and leather division losing further ground as the sector awaits an easing of trade tensions between Europe and the US. France-based LVMH, which owns over 70 brands ranging from handbags, high-end fashion and watches to spirits and hotels, has traditionally drawn on its size and geographical footprint to maximise profits and withstand headwinds. Yet the group is struggling to shake off consumer fatigue and reignite desire for luxury items. Sales for the second quarter to the end of June were down 4% to 19.5 billion euros (22.95 billion dollars), falling short of a consensus forecast for a 3% decline compiled by Visible Alpha, cited by UBS. Sales at the group's fashion and leather division, accounting for the bulk of profits, were down 9%, below expectations for a 6% drop. Chief Financial Officer Cecile Cabanis said on a call she was still "rather confident" about the rest of the year as the group expected trade talks between the EU and the Trump administration to deliver good news soon. Asked how LVMH would view a potential general tariff rate of 15% anticipated for exports to the United States, Cabanis said that would be an "overall good outcome for the general mood of our clients". With the exception of wines and spirits, some of LVMH's labels still have room to draw on their pricing power to mitigate the tariff impact, she said. In China, where a real estate crisis has dampened appetite for luxury goods, the group saw some improvement, Cabanis said, adding that the success of Louis Vuitton 's new ship-shaped store in Shanghai demonstrated the brand still had the clout to attract worldwide attention. Most luxury sector analysts still view the extended downturn that followed a post-pandemic boom as cyclical, induced in part by the prolonged slump in China, bouts of inflation and a yet unresolved trade dispute with the United States. But after two years of slowing sales following a post-pandemic boom, unease about the health of the industry is growing and high-end labels are scrambling to revitalise their offer. Consultancy Bain expects sales of luxury goods worldwide to fall between 2% and 5% this year after a 1% drop last year. LVMH has recently changed designers at Dior, Celine, Givenchy and Loewe, but they will need time to make their mark.
Miami Herald
02-07-2025
- Business
- Miami Herald
Sephora makes bold move to reverse concerning customer behavior
LVMH (LVMHF) , which owns beauty retail giant Sephora, recently suffered from an unexpected shift in customer behavior. In LVMH's first-quarter earnings report for 2025, it revealed that its U.S. sales "saw a slight decline" during the quarter, while the company's overall sales in perfumes and cosmetics remained flat. Don't miss the move: Subscribe to TheStreet's free daily newsletter During an earnings call in April, LVMH Chief Financial Officer Cécile Cabanis said that Sephora was one of the main reasons for the decrease in U.S. sales. Related: Ulta Beauty makes drastic decision on Target partnership "Sephora, on the other hand, faced very challenging comps after growing double-digit last year, and this explained the sequential deceleration of the U.S. market at group level," said Cabanis. She said that Amazon (AMZN) has been "very aggressive" about lowering prices, which contributed to Sephora's lower-than-expected U.S. sales. "In the U.S., we have a bit less momentum when it comes to e-commerce, especially because Amazon is being very aggressive, and being aggressive is mostly regarding price, and we try to avoid this technique," said Cabanis. She also warned that Sephora is suffering from an overall "softer demand in beauty," which may be partially due to consumers being concerned about tariffs and the U.S. economy. As Amazon prepares its big Prime Day sales event, Sephora has just made a huge effort to push more customers into its stores and away from online shopping. Sephora recently announced in a new press release that it has partnered with Lyft to offer customers $20 off rides to select Sephora stores in New York City, Seattle, Los Angeles, San Francisco, and Chicago. Related: Kohl's makes major store changes to win back customers Select Lyft vehicles involved in the partnership will even be "custom wrapped with Sephora branding." In addition, Sephora is offering customers who visit stores $10 off any order over $50 at checkout, a free personalized "skin scan," and exclusive product sampling. These promotions will last between July 7 and July 10. "We know that people today highly value in-person experiences when they're shopping for prestige beauty," said Sephora U.S. Chief Marketing Officer Zena Arnold in the press release. "They're looking for human connection and an expert-guided shopping journey, unique to their needs and goals." The move from Sephora comes ahead of Amazon Prime Day, which will offer significant discounts on a wide range of products between July 8th and July 11th. It is no surprise that Sephora is stepping up its game to win over customers during Amazon's big sales event, since the online retailer is offering bold deals on beauty products. More Retail: Costco quietly plans to offer a convenient service for customersT-Mobile pulls the plug on generous offer, angering customersAT&T makes generous offer to older customers For example, Amazon is offering Prime members savings of up to 35% on fan-favorite Korean beauty products, up to 30% on select luxury fragrances, and up to 40% on select cosmetics such as "Tarte, Urban Decay, and IT Cosmetics," according to a recent press release. Sephora isn't the only beauty retailer that recently noticed a pullback in consumer spending as Amazon continues to target more beauty consumers. During an earnings call in May, Ulta (ULTA) CEO Kecia Steelman said that hair care sales remained flat during the first quarter of 2025, while makeup sales "decreased slightly." "Consumer engagement with beauty remains healthy, and our insights indicate beauty and wellness remain a top priority for beauty enthusiasts who tell us that they're more willing to make tradeoffs in other discretionary areas to maintain their beauty regimens," said Steelman during the call. "At the same time, they are cautious, and value is an increasingly important priority as they navigate ongoing wallet pressures." Related: Temu suffers major loss as consumers change their tune The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
