LVMH's organic sales rose 2% in H1, profit fell 3.6% on currency, and fashion leather goods returned to growth in Q2 for the first time in two years, GlobalData said.
Alpha Score of 40 reflects weak overall profile with moderate momentum, poor value, moderate quality, moderate sentiment.
LVMH reported a return to organic growth in its fashion and leather goods division in the second quarter, the first such expansion in two years, though currency effects and a weak European market kept the recovery fragile, according to GlobalData.
Organic sales rose 2% in the first half of 2026, the company said Tuesday. Reported revenue fell 2.9% to €38.6 billion, an improvement from the 5.9% decline in the first quarter. Profit from recurring operations dropped 3.6% to €8.7 billion, almost entirely due to currency effects rather than softening demand, the company said.
“Fashion and Leather Goods returned to organic growth for the first time in two years,” said Sharon Iles, senior apparel analyst at GlobalData. She noted that Watches and Jewellery “pushed further ahead” despite a disrupted geopolitical environment in the Middle East. Management struck a confident tone for the rest of the year, pointing to new collections and store openings as the basis for sustaining a recovery through the second half, Iles said.
Regional performance improved broadly. Asia excluding Japan led the recovery with 6% organic revenue growth in the first half, helped by new Louis Vuitton flagships in Beijing and Seoul. Japan swung from a 3% organic decline in the first quarter to 14% growth in the second, leaving it up 5% for the half. The Japanese yen weakened sharply through Q2, trading near multi-decade lows against the dollar, which boosted tourist spending. The United States posted 4% organic growth, driven by a rapid acceleration in fashion and leather goods demand in the second quarter. Europe was the only region still in decline, down 1% organically for the half, reflecting dampened consumer demand and a weaker economic backdrop, Iles said.
By division, Watches and Jewellery led with 9% organic growth, accelerating to 11% in the second quarter, driven by Bulgari’s record-breaking Eclettica launch. Wines and Spirits and Selective Retailing each posted 5% organic growth, with champagne and cognac recovering and Sephora expanding its store network. Perfumes and Cosmetics stayed flat. Fashion and Leather Goods returned to 1% growth in the second quarter after a 1% decline in the first half, helped by the positive reception to Jonathan Anderson’s debut collection for Christian Dior and new Louis Vuitton stores in Asia.
The risk for LVMH is currency volatility, particularly the yen’s weakness. While it boosts tourist spending in Japan, it also pressures reported earnings when translated back to euros. Europe’s continued decline adds another challenge. Management’s confidence in the second half rests on new collections and store openings. Whether consumer demand in China and the US can sustain the momentum seen in the second quarter will determine if the recovery holds.
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