“To start with some good news, I think we’re going to make it through the winter,” joked Bernard Arnault, chairman and CEO of the world’s largest luxury group, LVMH, on Tuesday night in the auditorium of the company’s headquarters at 22 Avenue Montaigne. “The group’s earnings are solid in a fairly difficult environment, disrupted and unsettled on both the economic and geopolitical fronts. However, we have managed to get through this period. 2026 will not be very easy either, but one thing at a time.”
LVMH reported €80.8 billion in annual group turnover in 2025, down 1% from 2024, when annual sales were €84.7 billion. Sales of the fashion and leather goods division were down 5% in 2025 to €37.8 billion.
After a rocky two years, LVMH’s earnings on Tuesday confirmed that recovery is underway. After a 1% increase in the third quarter, sales in the fourth quarter also grew 1% on an organic basis to around €22.7 billion. By region, the United States was up 3%, Asia up 1%, Europe down 2% and Japan down 5%.
In the fourth quarter, the fashion and leather goods division declined 3% to €10.2 billion on an organic basis, in line with consensus expectations. This marks a deceleration compared with the third quarter, when fashion sales dipped 2%, against a tougher base of comparison due to last year’s post-election bump in the US.
This marks a significant improvement compared with the second quarter, when fashion sales were down 9 per cent.
LVMH is typically the bellwether for the industry, and its recovery has mirrored that of other fashion companies, though some have made stronger gains. Earlier this month, Richemont announced a 11% sales increase year-on-year for fiscal Q3. Brunello Cucinelli posted a Q4 revenue increase of 11.9% year-on-year to €388.6 million. Kering will report its results on February 11 and Hermès on February 12.
Perfumes and cosmetics sales were down 1%, while watches and jewellery sales rose 8% for the quarter. Selective retailing was up 7%. Wine and spirits were down 9%.
Analysts noted that 2025 profit beat consensus expectations. “LVMH seems to make the most of the difficult market environment to get the house in order,” Bernstein luxury analyst Luca Solca wrote.
Arnault went over the fashion brands starting with Dior, whose new creative director, Jonathan Anderson, presented his debut couture for the house on Monday, and whose first products arrived in stores on January 2. “The event of the week is the Dior haute couture show,” Arnault beamed.
“Everyone was wondering how it would go, because there is a new designer who is remarkable, but had never done couture before. Well, it was absolutely fantastic. Some spectators were even in tears, so moved by the quality, creativity, and craftsmanship of the garments,” he said. He called out the surprise appearance by former creative director John Galliano, who attended the show. “Even John Galliano was particularly moved and happy to see such a successor. It is a tremendous success. Dior is benefiting from this creative renewal; its products are in very high demand at the start of the year, so it’s getting off to a strong start.”
On Louis Vuitton, he praised the “beautiful show last week featuring particularly wearable clothes, always a plus. They were truly clothes you wanted to buy, along with exceptional trunks. I won’t give prices, especially since most of them have been sold.”
Rumors of a hotel opening in the Louis Vuitton flagship on the Champs-Élysées have long been circulating. But on Tuesday, Arnault dismissed further diversification at Louis Vuitton: “It’s not a brand that we particularly want to diversify. We already have a lot of products, many lines. We have two designers. Unlike Dior, Vuitton is not a fashion business, but a leather goods and trunk maker; that’s where the focus is. Just because Dior has a hotel room on Avenue Montaigne that allows us to host VIPs doesn’t mean Louis Vuitton will open a hotel.”
Meanwhile, “at Loro Piana, we have only one problem: slowing down growth,” Arnault said. Coinciding with the earnings, Arnault announced that LVMH has strengthened its position in Loro Piana by raising its stake from 85% to 94% through the acquisition of an additional 9% of shares for €1 billion. Arnault noted that Loro Piana’s valuation was around €2 billion when LVMH bought it in 2013, and it’s now worth around €11 billion. Maria Luisa and Pier Luigi Loro Piana will continue to serve as board members. “It’s very good to have family members because they are very well connected in manufacturing, especially when it comes to exceptional products around the world. For example, Pier Luigi regularly goes to Peru to take care of the vicuñas," Arnault said.
On the outlook for 2026, Arnault said: “I am optimistic in the medium term, but in the short term, it is very difficult to make a serious forecast because it is very hard to fully measure the geoeconomic impact on our businesses. What I am sure of is that the demand for high-quality products goes hand in hand with the evolution of living standards around the world. In the long term, we can be optimistic.”
“This year, of course, with the continuation of geopolitical crises, economic uncertainty, and policies from some states — including our own — that tend to be against businesses by taxing them heavily and creating unemployment, I think it’s reasonable to be a bit cautious. So we will apply the same approach as in 2025, meaning we will create very beautiful products, sell them worldwide, build attractive stores, and manage closely, limiting expenses, so that what we achieved this year can continue, ensuring that in 2026 our cash flow also grows.”
