Luxury Market Diverges
LVMH Reports €38.6 Billion H1 Revenue as US Demand and Jewelry Drive Growth
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Key Points
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Watches & Jewelry rose 11% in Q2, led by Tiffany and Bulgari.
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Fashion & Leather Goods growth remained weak with only 1% expansion in Q2.
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Interim dividend of €5.50 per share to be paid on December 3, 2026.
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H1 2026 operating margin is 22.5%, with recurring operating profit of €8.7 billion.
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U.S. Q2 sales grew 6% while Europe remained stagnant, highlighting regional divergence.
LVMH, the world's top luxury group, posted a 3% rise in second-quarter sales to about €19.5 billion, beating analyst expectations, according to France 24. The company also reported a net profit of €5.7 billion for the first half of 2026, as stronger U.S. demand helped offset persistent weakness in Europe.
For the full first half of 2026, LVMH's revenue reached €38.6 billion. Recurring operating profit came in at €8.7 billion, giving the company an operating margin of 22.5%. Free cash flow hit €4.1 billion despite headwinds from currency swings.
Watches and Jewelry Lead the Pack in Q2
The strongest performer this quarter was the Watches & Jewelry division, which grew 11% in Q2. Tiffany and Bulgari drove most of that gain. It was a clear bright spot in an otherwise uneven quarter for the luxury giant, according to Yahoo Finance.
Fashion & Leather Goods — home to Louis Vuitton and Dior — managed just 1% growth in Q2. That is a modest recovery after a rough stretch, but it remains far below the pace investors want to see. Wines & Spirits and Sephora also posted gains, helping broaden growth across the group.
U.S. Surges While Europe Stalls on Tourism Slump
The U.S. was LVMH's standout region. American sales grew 6% in Q2 as wealthy shoppers kept spending. That momentum helped carry the group's overall results above what analysts had forecast, France 24 reported.
Europe told a different story. Tourism traffic slowed sharply, hurt by tensions linked to the Middle East conflict. Fewer international visitors meant fewer big-ticket purchases at flagship stores in Paris and Milan. European sales were essentially flat for the quarter, dragging on Fashion & Leather Goods in particular.
LVMH Sells Marc Jacobs, Bets on Flagship Stores
LVMH made two notable strategic moves in the period. The group sold off the Marc Jacobs brand and also cut assets at its DFS travel retail unit. Both moves signal a sharper focus on its most profitable, high-profile labels, according to Yahoo Finance.
At the same time, the company is investing heavily in flagship store upgrades and omnichannel retail — meaning shoppers can buy seamlessly in-store or online. The goal is to protect its margins and keep the luxury experience front and center, even as rivals chase the same high-spending customers.
Dividend Declared as Investors Watch Recovery Closely
LVMH's board approved an interim dividend of €5.50 per share, to be paid on December 3, 2026. The payout signals confidence from management, even as the broader luxury market has yet to show a full recovery, France 24 noted.
Investor sentiment stays cautious. Shares have faced pressure as analysts question whether the pickup in Q2 can hold. Currency headwinds remain a real drag on reported numbers. The gap between a booming U.S. market and a sluggish Europe will be the key thing to watch in the second half of the year.
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