LVMH abdicated to Hermes as the most valuable luxury stock in the post-Salesmith world

Stocks LVMH After an unexpected decline in sales in the first quarter, it lost its position as the world’s largest luxury company.

LVMH reported a 3% year-on-year decline in first quarter sales in a trading update released shortly after the market closed on Monday.

The results reduced the broader sector in morning trading amid wider market profits. Kering Stocks fell 4.2%, Burberry It fell 4.3% Richmont 1.6% lower trading.

LVMH shares fell 7.9% at 2:07pm in London due to its worst session since March 2020. A 0.8% drop in Hermes’ stock price saw the Birkin Bag Maker’s market capitalization surpass that of LVMH.

CNBC’s LSEG data calculations show that the afternoon movement has led to LVMH’s market capitalization of 244.4 billion euros ($2764 billion) to 244.3 billion euros.

LVMH has spent several years as Europe’s most valuable company since 2021. This is because gorgeous stocks were driven by hopes of a 19-post pandemic boom. Since records were closed in 2023, they have lost 45% of their value.

It was overtaken by a Danish drugmaker Novo Nordisk Late 2023 – Before the makers of Weitros Drugs Ozempic and Wegovi were taken by German software company SAP in March 2025 in itself.

LVMH’s wines and spirits fell 9%, with the sharpest revenue decline in the first quarter. This is because they flagged the weak US and China demand for cognac.

The major fashion and leather products sector, which accounted for 78% of profit in 2024, slipped 5%. Watches were sold flat.

Europe is the only region to record growth, rising 2%, on an organic basis. With the exception of Japan, Asia, except for 11%, US sales were 3% lower, while Japan fell 1%.

City analysts Thomas Chaubet and Mahesh Mohankumar said on Monday evening that they “we don’t really support the gorgeous pioneers.”

They added that it would be difficult to predict second and third quarter successive revenue improvements for either the LVMH or the premium sector, but economic uncertainty in the US and globally remained rising.

“The structural growth drivers are maintained, but short-term visibility is very limited, especially in light of trade tensions and tariffs… The next positive catalyst for the LVMH/sector should probably come from macro surprises, as the basics are likely to remain harsh in the short term.

The luxury sector, which relies on global supply chains and US consumer demand, faces many headwinds from US President Donald Trump’s volatile trade policy.

LVMH, which owns brands such as Louis Vuitton, Moet & Changdon and Hennessy, is the first major European luxury company to Trump announce its global trading partners, then announced mutual tariffs after delayed and then reported delayed first quarter revenue.

Therefore, investors provide companies with guidance on advancement regarding the potential impact of tariffs on input costs and consumer demand.

LVMH’s chief financial officer, Cecil Kabanis, told analysts in a call Monday that the group had not seen “a major change in trends” in the first quarter, and that it had continued to grow steadily over the past six months.

“Ambitional customers have always been more vulnerable in non-positive economic cycles and uncertainties, which may have had some impact in recent weeks, but may have influenced categories such as wine, spirit and beauty,” Kabanis said.

Kavanis declined to comment specifically on pricing for the second quarter, but said it would consider using product rippolicking as a level and moderately offsetting inflation in the currency.

Luxury brands are expected to evacuate more than other retailers due to the immediate impact of tariffs, and high-end labels can usually pass additional costs to wealthy consumers.

Still, analysts warn that the potential for a tariff-induced economic downturn can lead to a greater and more heavy demand, allowing sector recovery from periods of long-term weakness, particularly in the important US and Chinese markets.