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LVMH’s Fashion & Leather Goods division, the group’s largest business, posted a 5% organic sales decline to €8.245 billion (£6.97 billion) in the third quarter, with weaker demand in China reversing the unit’s return to growth. The fall was steeper than the 1.6% decline analysts had expected and followed the division’s 1% organic rise in the second quarter, its first gain in two years.
However, Selective Retailing, which includes Sephora, grew 8% in the third quarter, with organic growth also recorded in the group’s beauty and perfume division.
Overall, the group recorded revenues of €57.1 billion (£48.28 billion) in the first nine months of 2026, with organic revenue growth of 2%. The company said that, due to its diverse range of businesses – spanning wine and spirits to fashion, leather goods and beauty – the group “remained very solid in an uncertain geopolitical and economic environment.”
Group revenue came to about €18.504 billion (£15.63 billion) in the three months to 30 September, up 1% organically. The group said it had been impacted by a weaker environment in China, although the US, Europe and Japan recorded growth.
China weighs on Louis Vuitton
Chief Financial Officer Cécile Cabanis told analysts on the earnings call that LVMH’s Chinese clientele was down by a mid-teens percentage in the quarter.
“The quarter was marked by a more macro-led challenging consumer backdrop among Chinese clientele, which resulted in a mid-single-digit decline in Asia for the quarter, with a more tangible impact on fashion and leather goods, the division most exposed to the region,” she said.
Across the group, the US grew 5% and Japan 6%, with Europe up by a mid-single-digit percentage.
Cabanis said Christian Dior, Loro Piana and Rimowa outperformed within the division, while Louis Vuitton was slightly below its average. She added that a freight forwarder’s “one-off logistic and transportation disruption” cost Louis Vuitton “a bit more than a point of growth”.
The brand’s trademark dispute with Chinese tea chain Molly Tea, in which a court awarded damages of about £1.1 million, may also have played a part. “It’s very difficult to quantify the precise impact, but, net-net, it’s probably fair to say that it had a negative impact, at least at the beginning of the quarter,” Cabanis said.
Sephora drives beauty retail
Selective Retailing, which also includes Le Bon Marché, generated about £3.44bn in Q3. LVMH said Sephora gained market share in several countries, with Rhode and several C-Beauty brands among its exclusive launch offerings, and entered Belgium and Croatia.
“Sephora continues to excite worldwide with growth across all regions, notably its two largest markets, the U.S. and Europe,” said Rodolphe Ozun, Director of Financial Communications.
Cabanis said Sephora’s Q3 growth was broad-based across markets and categories, with like-for-like growth accounting for around half of its reported growth. LVMH did not disclose a separate growth rate for Sephora.
The Perfumes & Cosmetics division grew more slowly, up 1% organically to about £1.70bn, and was flat across the first nine months.