LVMH Q3: Fashion and leather sales fall 5% as China demand weakens, group sales +1%

LVMH reported that sales at its fashion and leather goods unit fell 5% in the third quarter compared with a year earlier, a setback the group said on Oct 12 reflected a renewed slowdown in demand from China.

The decline in the bellwether division outpaced analysts’ expectations: third-quarter organic revenue at the unit fell by more than the 1.8% analysts had forecast for the three months to September. LVMH said the drop reverses the previous quarter’s first period of growth in the unit in two years, a point Channel NewsAsia highlighted in its coverage.

Despite the weakness in China, LVMH said its fashion and accessories business continued to benefit from what it described as a "buoyant US market," which helped limit the overall hit. Group sales across the conglomerate rose 1% in the third quarter, the company reported, leaving total group revenue marginally higher even as the fashion division slid.

The company pointed to wider pressures weighing on luxury spending, naming the Middle East conflict, geopolitical turmoil and inflation as headwinds affecting the sector.

Within the group, Dior — LVMH’s second-biggest brand — was singled out as performing positively, with the house seeing "especially strong" demand for Jonathan Anderson’s ready-to-wear and leather goods lines, the company said.

Analysts had expected a milder contraction at the fashion and leather goods unit; LVMH’s larger-than-anticipated fall in organic revenue therefore raises questions for the luxury sector about how quickly momentum in China can recover.

The group framed the result as a mixed picture: resilient sales in the United States offsetting a continued slowdown in China, producing only modest growth at the group level.

Other outlets’ headlines echoed LVMH’s figures: Quartz, Euronews and Luxury Tribune noted the 5% drop in fashion and leather goods sales, while NEWS.am STYLE and Idéal Investisseur highlighted similar themes around weaker demand for Louis Vuitton and Dior in China.

LVMH’s own statements on Oct 12 form the primary account of the quarter’s performance and the factors the company identified as weighing on sales.

The quarter therefore leaves LVMH balancing pockets of strength against persistent China weakness; the firm reported a small rise in total sales but signalled that the fashion and leather goods division — historically a bellwether for luxury sentiment — remains vulnerable to shifts in Chinese demand.