French luxury group LVMH (Louis Vuitton, Dior, Celine, Moët Hennessy) saw net profit plummet 22 percent in the first half of 2025, the company announced Thursday, June 25, blaming the plunge on an “unsettled economic and geopolitical” backdrop.
Cosmetics and selective distribution step in to save the day
Though sales fell four percent to just under 40 billion euros (47 billion dollars), chairman and CEO Bernard Arnault insisted that LVMH “is demonstrating its resilience in the current context”.
In the first half-year, sales in the “Fashion and Leather Goods” and “Wines and Spirits” divisions, both down 8%, were the biggest contributors to the group’s downfall results. Sales of the “Perfumes & Cosmetics” business group remained stable, as was the “Watches & Jewelry” division.
As far as “Selective Distribution”, which includes Sephora, Le Bon Marché and DFS, is concerned, sales remained close to that of the same period in 2024, at 8.6 billion euros.
Trump tariffs
Like the broader luxury sector, LVMH is grappling with a slowdown in consumer spending in China and a general decline in global demand for luxury goods. The group now also faces added pressure from U.S. tariffs and stricter Chinese regulations.
The producer of Louis Vuitton bags and Dom Perignon champagne has been hit especially hard by US President Donald Trump’s threat of tariffs, as it generates a quarter of its revenue in the United States.
In the wake of the US president’s April 2 “Liberation Day” tariff announcements, Arnault, Europe’s richest man, saw Hermes overtake LVMH as the world’s most valuable luxury company.
Trump imposed a 10-percent tariff on imports from around the world that month, but he delayed higher duties on dozens of other countries, with an August 1 deadline to strike trade deals or face tougher levies looming.
“We are approaching the second half of the year with great vigilance, and I am confident in LVMH’s formidable long-term potential,” Arnault, who was present at Trump’s second inauguration in January, said in Thursday’s press release.
