LVMH Moët Hennessy shares dropped in Paris trading Tuesday after the luxury conglomerate reported Q1 earnings that fell short of Bloomberg Consensus estimates. The miss was driven by softening demand for high-end goods in top markets such as Asia and the U.S., as a deepening trade war pressured consumer sentiment.
LVMH’s first-quarter results served as a luxury gut-check for the industry, with a broad-based miss across segments and regions led by sliding demand in key markets, including China and the U.S. Fashion and Leather Goods — the group’s growth engine — also stumbled, signaling concerns about a wider slowdown in the high-end consumer space.
Here’s a summary of the first quarter results:
Red Flags:
Organic Revenue -3% vs. +1.1% est. (Bloomberg Consensus): A troubling miss, signaling a sharp deterioration in underlying business momentum.
China and U.S. Weakness:
Asia ex-Japan -11% vs. -4.69% est.
U.S. -3% vs. +1.19% est.
These are core markets for LVMH, and their underperformance is very concerning, especially given the exploding trade war in recent weeks.
Fashion & Leather Goods -5% vs. -0.55% est.: This is LVMH’s crown jewel segment, and this large miss spooked…
Read the full article here