LVMH Struggles, But Sees Recovery in Q3

Paris—LVMH posted a double-digit drop in revenue in its third quarter, but the French luxury titan is seeing improvements.

Third-quarter revenue totaled €11.96 billion ($14.09 billion), a 10 percent decrease compared with the previous year.

The company noted a return to growth in its cognac and fashion and leather goods categories in particular.

For the first nine months, company revenue totaled €30.35 billion ($35.76 billion), down 21 percent on a comparable basis.

The luxury giant reported “encouraging signs of recovery observed in June” and saw growth in the United States and Asia.

Growth in its online sales, meanwhile, have “partially offset” the negative impact on revenue felt from several months of store closures due to the COVID-19 pandemic.

Quarterly revenue in LMVH’s watches and jewelry segment totaled €947 million ($1.12 billion), a 16 percent decrease year-over-year.

LVMH noted a rebound in China in the quarter, but it was not enough to offset the overall decline.

For the first nine months, revenue in the watches and jewelry segment was down 30 percent to €2.27 billion ($2.67 billion).

Bulgari released a new line of Barocko fine jewelry while its B.Zero1 and Divas’ Dream collections also performed well.

And the brand’s new watch models, presented at the Geneva Watch Days, were well received by distributors, LVMH said.

Chaumet launched Perspectives, an architecture-inspired fine jewelry collection.

In the watches segment, TAG Heuer celebrated its 160th anniversary with new models from the Carrera line and launched a Special Golf smartwatch. The watch brand was also named an official partner of the Porsche Golf Cup France.

Hublot launched its Big Bang E connected watch while Fred introduced the “Chance Infinie” capsule collection.

Looking ahead, LVMH said it will “continue to exercise caution, strengthen its cost controls and selectivity in its investments.”

As for its pending acquisition of Tiffany & Co., which is currently in dispute, the company said it has received nine of the 10 regulatory approvals it needs and expects to receive approval of the acquisition from the European Commission by the end of October.

The trial is set for Jan. 5, 2021.