- LVMH reported a 1% drop in U.S. sales during the second quarter. The company's CFO, Jean-Jacques Guiony, attributed the decline to a decrease in spending by aspirational customers, particularly on entry-level products. He speculated that the fading impact of stimulus payments after the COVID pandemic could have been a contributing factor.
- This performance in the U.S. luxury market comes in the wake of a similar trend seen in Richemont, the owner of Cartier, which also reported a 4% decline in U.S. sales earlier in the month. This may put pressure on other luxury stocks, as analysts express concerns about a potential U.S. luxury slowdown.
Why it matters
The drop in sales indicates a shift in consumer behavior and preferences, potentially reflecting changes in spending patterns post-COVID and a more cautious approach from aspirational consumers when it comes to luxury purchases.