Is This the Beginning of a Luxury Reset? LVMH Says Yes—and No

Image courtesy: lvmh.com

“Solid performance in a disrupted global economic and geopolitical environment” — that’s how luxury conglomerate LVMH described its year-end 2025 financial results. Reported revenue for the year totaled €80.8 billion, down nearly €4 billion from 2024, as sales in its largest division, Fashion & Leather Goods, declined 5%.

But LVMH found bright spots, particularly in the second half of 2025, posting a 1% revenue gain in the final quarter. The full-year result was a 1%, an improvement over the first-half trajectory.

Fashion & Leather Goods also showed strengthening momentrum in the second half and fourth quarter. CEO Bernard Arnault cited “solid local demand” for its products, despite headwinds from tariffs, rising gold prices, and currency fluctuations.

As successes, Arnault pointed to Louis Vuitton’s recent “fine” men’s show by Pharrell Williams, featuring “highly wearable clothing” and trunks created by the same people who did the stained glass at Notre Dame. He also highlighted the Shanghai Vuitton ship museum and the new boutiques in New York City and Los Angeles. And for anyone hoping for a Louis Vuitton hotel, Arnault made clear Louis Vuitton has no plans to go into the hotel business.

Dior was top of mind for LVMH, as its new creative director Jonathan Anderson had shown his first haute couture collection for Spring 2026 just the day prior. Arnault called it amazing and “the event of the week.” Any early successes for Dior are not reflected in 2025 numbers, though Arnault said it is off to a strong start.

Image courtesy: dior.com

In 2025, the Watches & Jewelry division reported a revenue increase of 3%. As we have written before, jewelry was a favored item in 2025, as some luxury customers shift away from fashion items like handbags.

Read: Is Jewelry Replacing the ‘It’ Bag: Van Cleef & Arpels and Cartier Drive Richemont Growth

But watch out Tiffany fans: silver is on the way out. LVMH says that it is not only transforming its retail spaces, but also its product selections. It will now focus on gold, diamonds, and platinum, aka high jewelry. Aspirational shoppers who got their first taste of Tiffany with a silver piece may be left out of this luxury brand.

Sales in Perfume & Cosmetics were flat (on an organic basis). Wine & Spirits continues to lag, largely due to a 12% decline for Cognac & Spirits.

Geographically, revenue distribution remained stable across regions. LVMH reported improved trends in all markets except Europe. The positive momentum in China that began in Q3 continued into Q4, though at a moderately slower pace. Japan’s performance reflected challenging year-over-year comparisons against a strong 2024.

LVMH’s repeated emphasis on the “disrupted” and “challenging” geopolitical and economic environment may have found its counterpoint in an extended discussion of the firm’s “heightened commitment to corporate responsibility.” The company devoted an entire page of the presentation to its LIFE 360 environment program and workforce initiatives. This focus perhaps suggests a strategic pivot to controllable factors —particularly salient when confronting an economic landscape that shifts rapidly and unpredictably.

While LVMH typically acts as a bellwether for the luxury industry, whether it does so now remains to be seen. Fine jewelry has been a bright spot for luxury lately. Absent a sparkle division, it’s an open question if all luxury will shine in 2026. Arnault admits it will not be simple, but says,

“In 2026, in an environment that remains uncertain, our Maisons’ ability to inspire dreams – coupled with the highest levels of vigilance with regard to cost management, and our environmental and social commitments – will once again be a decisive asset underscoring our leadership position in the luxury goods market. We will remain true to our entrepreneurial tradition as a forward-looking family group focused on sustainable creativity in high-quality products, exceptional spaces and the long-term future of our outstanding craftsmanship.”

Will you continue purchasing luxury goods? What might change your mind? Let us know.

Love, PurseBop