LVMH reported first-quarter revenue of €19.1 billion, coming in below the €19.6 billion analysts had been expecting. On an organic basis, revenue increased 1%, short of the 1.95% consensus. Reported total revenue was down 5.9% year-on-year.
The conglomerate's largest business, Fashion & Leather Goods, underperformed expectations. Organic sales in the division fell 2%, versus analyst forecasts for a near-flat decline of 0.05%. The segment produced €9.25 billion in revenue, an 8.5% decline from the prior year and beneath the estimated €9.48 billion. Management said the conflict in the Middle East exerted a roughly 1% negative impact on organic growth for the quarter.
Following the results, LVMH American depositary receipts slipped 2.7% in New York trading.
Not all divisions disappointed. Watches & Jewelry posted robust organic growth of 7%, ahead of the 4.21% estimate, with Tiffany's HardWear line singled out for particularly strong performance. Wines & Spirits also beat expectations, registering 5% organic growth compared with an anticipated 0.83% decline; the company attributed some of that strength to a favorable Chinese New Year calendar effect for Cognac.
Geographically, Asia excluding Japan delivered 7% organic growth, topping the 4.2% estimate. The United States recorded 3% organic growth, marginally above the 2.9% consensus. Europe was weaker, with a 3% decline versus an expected 0.75% decline.
Other divisions produced mixed outcomes. Perfumes & Cosmetics saw organic revenue flat for the period, below the 1.74% growth estimate. Selective Retailing grew 4% organically, underperforming the 6.2% analyst consensus.
In commentary, the company said it remains vigilant yet confident at the start of the year and reiterated a focus on developing its brands through sustained innovation and investment.
Data recap
- Q1 revenue: €19.1 billion (est. €19.6 billion)
- Organic revenue growth: 1% (est. 1.95%)
- Fashion & Leather Goods: €9.25 billion, -8.5% YoY; organic -2% (est. -0.05%)
- Watches & Jewelry: organic +7% (est. +4.21%)
- Wines & Spirits: organic +5% (est. -0.83%)
- Asia ex-Japan: organic +7% (est. +4.2%); US: +3% (est. +2.9%); Europe: -3% (est. -0.75%)