{"id":29044,"date":"2026-05-05T07:05:02","date_gmt":"2026-05-05T07:05:02","guid":{"rendered":"https:\/\/hunthow.com\/?p=29044"},"modified":"2026-05-05T07:05:02","modified_gmt":"2026-05-05T07:05:02","slug":"4-takeaways-from-luxurys-q1-earnings","status":"publish","type":"post","link":"https:\/\/hunthow.com\/?p=29044","title":{"rendered":"4 Takeaways From Luxury\u2019s Q1 Earnings"},"content":{"rendered":"


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Luxury\u2019s hopes for a slight first-quarter rebound have been set back, as conflict in the Middle East delivers a blow to performance.<\/p>\n

\u201cQ1 didn\u2019t really change the sector\u2019s outlook, and, if anything, it slowed down or pushed back the recovery story we had in mind,\u201d Barclays head of European luxury goods research Carole Madjo says. \u201cThe market has lowered its Q2 estimates to factor in the impact of the Middle East conflict and the disrupted tourism environment. The sector\u2019s downgrade cycle is still ongoing on the top line, and potentially on margins as well.\u201d<\/p>\n

HSBC anticipated a 5.5% increase<\/a> in global luxury sales in Q1 2026. However, the average organic sales growth of LVMH, Kering, Herm\u00e8s, Moncler, and Prada materialized at 4.2%.<\/p>\n

\u201cFor most companies, momentum in China is improving every quarter. The big issue continues to be the drop in Chinese tourism,\u201d TD Cowen analyst Oliver Chen says. \u201cThe US continues to be a resilient and attractive market, with a K-shaped economy \u2014 where the top end grows, but the lower end is seeing more pressure particularly as consumers watch gas prices. The strongest momentum comes from jewelry.\u201d<\/p>\n

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While soft luxury brands have shown relative weakness, the jewelry \u201csupercycle\u201d continues. Sales at LVMH\u2019s watches and jewelry division, Kering\u2019s jewelry arm, and Herm\u00e8s jewelry were up 7%, 22%, and almost 10%, respectively. This bodes well for Cartier owner Richemont, which will publish its annual earnings on May 22.<\/p>\n

At LVMH\u2019s annual general meeting<\/a> on April 23, chair and CEO Bernard Arnault warned investors that the Middle East crisis \u201ccould turn into a global catastrophe with extremely serious and very negative economic consequences\u201d. He added: \u201cIn which case, who can say how 2026 will play out? Or it might be resolved one way or another more quickly, which is what we all hope for, even if it doesn\u2019t seem easy; and in that case, business will gradually return to normal.\u201d<\/p>\n

Here are the key takeaways from luxury\u2019s Q1 earnings.<\/p>\n

The impact of the Middle East crisis<\/strong><\/h2>\n

Despite variation between companies, the conflict in the Middle East has impacted sales growth by around 1 to 2 percentage points. Some are less exposed, such as Moncler, which generates less than 2% of its business in the Middle East, while others like LVMH, Kering, and Herm\u00e8s are more reliant on the region; LVMH generates approximately 6% of its sales in the Middle East, Kering generates roughly 5% of its retail sales in the region, and Herm\u00e8s 4.3% of sales. (According to Jefferies estimates, Herm\u00e8s totals almost 8% with Middle Eastern spending abroad.)<\/p>\n<\/div>\n


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Luxury\u2019s hopes for a slight first-quarter rebound have been set back, as conflict in the Middle East delivers a blow to performance. \u201cQ1 didn\u2019t really change the sector\u2019s outlook, and, if anything, it slowed down or pushed back the recovery…<\/p>\n","protected":false},"author":1,"featured_media":29045,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[125],"tags":[],"class_list":["post-29044","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fashion"],"_links":{"self":[{"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/posts\/29044","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hunthow.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=29044"}],"version-history":[{"count":0,"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/posts\/29044\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hunthow.com\/index.php?rest_route=\/wp\/v2\/media\/29045"}],"wp:attachment":[{"href":"https:\/\/hunthow.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=29044"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hunthow.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=29044"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hunthow.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=29044"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}