LVMH (LVMHF), a global luxury-goods group whose brands span fashion, jewelry, wines and retailing, fell 1.5% in Tuesday's European trading after its largest division delivered weaker growth than analysts expected. Organic sales at the fashion and leather-goods business increased 1% to 8.90 billion, marking the division's first growth in two years. Analysts had expected growth of 1.7%, leaving the result below the level investors had anticipated for a potential luxury-market recovery.
Overall organic sales increased 3%, supported by an 11% gain in watches and jewelry, 6% growth in selective retailing and a 5% increase in wines and spirits. The United States generated 6% organic sales growth during the second quarter, helping offset weaker tourism-related spending in Europe during the conflict involving Iran. LVMH reported total quarterly sales of 19.5 billion. First-half current operating profit declined 4% to 8.7 billion, including an approximately 700 million currency impact, while the operating margin stood at 22.5%.
LVMH shares have declined approximately 30% during 2026 and were trading near a six-year low following the results. RBC Capital Markets, Morgan Stanley and UBS lowered their price targets, adding to concerns about the pace of improvement in luxury demand. Fashion and leather-goods growth missed the consensus estimate by 0.7 percentage point, an important difference because the division remains central to LVMH's earnings profile and investor expectations. Upcoming results from Kering and Hermes may provide additional evidence about whether the weakness reflects company-specific execution or broader luxury-market conditions.