Bernard Arnault, Chairman and CEO of LVMH Moet Hennessy Louis Vuitton, speaks during a press conference to present the 2023 annual results of LVMH in Paris, France, January 25, 2024.
Benoit Tessier | Reuters
LVMH shares plummeted over 7% in morning trading Wednesday after the French luxury conglomerate reported a slight fourth-quarter sales beat late Tuesday, but failed to impress investors who had set the bar higher following strong earnings from competitors.
LVMH shares were last seen 7.5% lower, while rival Gucci-owner Kering dropped 5%.
While organic revenue grew 1% to a total of 22.7 billion euros ($27.2 billion) in the fourth quarter, a similar rate as in the prior quarter, though it declined 1% over the full year.
Investors had expected stronger numbers. “With peers such as Richemont, Burberry, and Cucinelli reporting solid QoQ improvements and beating expectations, the bar had moved slightly higher,” Citi analysts said in a note.
Talking to investors, CEO Bernard Arnault warned that “2026 won’t be simple,” and that geopolitical factors may weigh on luxury players’ outlook.
“I always say that in our businesses, I am optimistic in the medium-term but short term it is very difficult to provide a serious forecast,” Arnault said on Tuesday. “So many events and the pace of decisions taken left and right in the various countries, it is extremely difficult to control all these geo-economic impacts on our companies.”
LVMH’s key fashion and leather goods division, accounting for the bulk of the group’s profits, showed organic sales declined 3% in the fourth quarter, largely in line with expectations, while wine and spirits declined 9%. Its selective retailing business, which includes beauty brand Sephora, and its watches and jewelry division, grew by 7% and 8% in the quarter, respectively.
