LVMH: Fashion Sales Drop 5% Amid Weak Chinese Demand
LVMH recorded organic growth of 1% in the third quarter with revenue of around 18.5 billion euros, while fashion and leather goods sales fell 5% as demand from Chinese customers declined.
French luxury group LVMH reported third-quarter revenue of approximately 18.504 billion euros with organic growth of 1%, a slowdown from 3% growth in the second quarter.
Sales in the fashion and leather goods division dropped 5% on an organic basis to 8.245 billion euros, performing worse than the roughly 1.6% decline expected by analysts.
In contrast, the selective retailing segment, which includes Sephora, rose by 8%, with sales in the United States recording a 5% increase and Japan 6%.
Chief Financial Officer Cécile Cabanis stated that the group's number of Chinese customers fell by a mid-teens percentage during the quarter, amid weak demand in the Chinese market.
What do these terms mean?
Organic growth: The increase in sales generated from existing operations, excluding the impact of acquisitions or foreign exchange rate changes.
Selective retailing: The sale of luxury goods through dedicated stores and platforms, including beauty retailers like Sephora.
Mid-teens: A common expression in business reports meaning a percentage that falls within the 10–19% range, close to its middle.
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