Following a phenomenal year in 2022 with an impressive growth rate of +23%, luxury conglomerate LVMH is continuing its success story into 2023. The company’s first quarter results reveal a 17% increase in sales compared to the same period last year, amounting to a staggering 21.035 billion euros.
LVMH attributes its strong performance to various factors. Firstly, the gradual recovery of tourist flows has played a crucial role in boosting sales. As international travel gradually resumes, more tourists are flocking to luxury stores and contributing to LVMH’s success. Additionally, the rebound in consumption in Asia, particularly in China, has further propelled the company’s growth. As sanitary restrictions are lifted in the region, Chinese consumers are showing a renewed interest in luxury goods, driving up sales for LVMH.
Within the retail sector, Selective Retailing experienced a remarkable surge in sales of +28% during the first quarter of 2023. This impressive growth is primarily attributed to the strong performance of Sephora and travel retail. Sephora, known for its wide range of beauty products, has managed to capture the attention of consumers, leading to increased sales. Furthermore, travel retail, which provides luxury items to travelers, has capitalized on the gradual return of tourists, contributing to the segment’s remarkable success.
In the Fashion & Leather Goods segment, LVMH witnessed a growth rate of +18%, generating sales of 10.7 billion euros. The powerhouses Louis Vuitton and Christian Dior played a pivotal role in driving this growth, while the Celine brand achieved “very high growth,” according to the company. The Watches & Jewelry segment also experienced a healthy growth rate of +11%, while Perfumes & Cosmetics saw an increase of +10%, largely driven by the exceptional performance of Christian Dior Beauty. Finally, the Wines & Spirits division experienced a more moderate growth of +3%.
Earlier this year, LVMH reached a significant milestone by surpassing a market capitalization of 400 billion euros, making it the first European company to achieve this feat. This remarkable achievement underscores the strength and influence of the luxury sector. Furthermore, the recent BrandZ ranking of the 50 most powerful French companies highlighted LVMH’s dominance in the luxury market. Five of the top ten brands with the highest value growth belonged to LVMH, with Louis Vuitton leading the pack.
Considering the continuous growth of consumer demand for prestigious goods and services, LVMH is determined to capitalize on this momentum by strengthening its recruitment strategy. The company recognizes the need to attract top talent to support its expansion and maintain its position in the luxury market.
Useful links:
– Bloomberg article on LVMH’s sales growth
– Business of Fashion article on LVMH’s market capitalization milestone
