After posting a historic decline in its stock price over the first three months of the year (-28.2%), the luxury sector leader released its first-quarter results for fiscal year 2026. While resilient, the group nevertheless saw a slowdown in its Fashion and Leather Goods division, impacted by an unfavorable geopolitical environment in the Middle East and a strong dollar.
The paradigm shift is taking hold in the luxury sector.
Even before the release of LVMH’s first-quarter 2026 results, analysts were warning of the end of double-digit growth for the luxury sector as it had been experienced from 2016 to 2021.
On April 13 after the market closed, LVMH announced first-quarter 2026 revenue of €19.9 billion, down 6% on a reported basis and up 1% on a like-for-like basis.
As the first luxury player to release its 2026 results, Bernard Arnault’s group demonstrated remarkable resilience amid a turbulent geopolitical landscape. It was not spared, however: its core business, the Fashion and Leather Goods division, washard hit, with a 9% decline on a reported basis.
In addition to an increasingly pronounced preference for experiential luxury and second-hand goods—which is affecting many players in the sector—LVMH is grappling with an unfavorable currency effect (-7%) as well as severe tensions in the Middle East. The conflict in Iran, which has been ongoing since February 28, is estimated to have cost one percentage point of growth for the luxury leader, thereby offsetting the positive effects of the restructuring of Christian Dior Couture.
The Middle East, in turn, is slowing down
A providential growth driver in 2024 and 2025 amid China’s slow recalibration, the Middle East is now directly impacted by the war in Iran.
According to statements from LVMH, which currently generates 6% of its revenue in the region (compared to 8–10% for the global luxury market), the conflict has already cost the company one percentage point of growth, and this is even before taking into account indirect effects such as the decline in tourism.
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Read more > Stock Market: LVMH Posts Worst First Quarter in Its History
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