The recovery of the luxury buyer faces four winds against keys

High -end speakers are painting a mixed image when it comes to the long -awaited recovery of the luxury market, with softer sales that still weigh in the company’s forecasts.

But results better than the fearful of Bellwether’s fashion house LVMH He moved the highest luxury actions on Friday, since investors bet on the appearance of green recovery outbreaks.

LVMH recorded an annual 4% drop in sales of the second quarter to 19.5 billion euros after the closure of the market on Thursday, slightly below a consensus forecast for a 3% decrease.

“This was not a stellar quarter for LVMH,” Adam Cochrane of Deutsche Bank, an luxury capital research analyst, wrote on Friday. “However, we see some flashes of hope with a sequential improvement in CFX [constant currency] The expected sales from 3q onwards and most of the weakness of sales related to weakest tourism. “

Here is a look at four key trends to take into account the season of the profit season, with new numbers that are due next Kering week, Hermes and Prada.

Currency fluctuations are a perennial concern for luxury companies, but that is even more the case this quarter, since they face high comparable sales last year.

A strong decrease in Japanese Yen caused an increase in tourist flows and luxury purchases in the country in 2024. But now the brands are fighting a rebalancing.

Richemont Sales in Japan fell 15% year after year in three months to June, after a 59% jump during the same period of the previous year. Burberry also cited a “challenging performance” in Japan in the second quarter, and Moncrito He said Japan was his only negative performance Asia market, both without providing specific figures.

However, some companies pointed out that a recession in tourism to Japan, and to a lesser extent Europe, has resulted in an increase in internal spending on certain other markets.

“[In China] We have seen a tangible improvement locally, “said LVMH’s financial director Cécile Cabanis, during a profit call on Thursday, citing a” repatriation of the great fall we have seen in Tourism to Japan. “

Several luxury companies have also indicated a strengthening of US sales in the second quarter, even when consumers wait with breathing contained by the impact of rates.

BurberryRichemont, Moncler and Brunello Cucinelli All reported an increase in sales in their US markets during the second quarter, while LVMH said that US demand was “widely unchanged.”

Even so, the extent to which this increase is driven by American customers who make front purchases before the complete start of tariffs is not yet clear, according to companies.

“To tell him that this was driven by the anticipation of buying links to tariffs? Honestly, I can’t tell him,” said Roberto Eggs, Moncler’s main commercial strategy and the global market officer, in a earning call on Wednesday.

Luxury companies have also been perfecting the US market in the last quarters in an attempt to compensate for continuous soft demand in the key Chinese market.

Burberry CEO, Joshua Schulman, said that the recent growth of the company in the United States indicated the “diversity of the luxury consumer that exists in that market”, from elite and high level for buyers of central plants.

However, American tariffs weigh on the prospects for most European luxury houses, which depend largely on the production located as part of their cache.

As such, many have suggested that they will need to increase prices in the next quarters to compensate for additional costs.

Brunello Cucinelli marked price increases from 3% to 4% in the USA while Moncler said he was implementing percentage increases in “average digits” for the next 12 months. Burberry, meanwhile, said he began to adjust prices last year as part of the broader review plans.

LVMH, on the other hand, said Thursday that price increases would have to come with an “product improvement” or a modest re -quilibrium around inflation.

However, the French luxury conglomerate then cited price increases between “several levers” at your disposal to counteract the impact of tariffs.

It occurs since the cost of luxury goods has increased by an average of 3% so far this year, the slowest pace since 2019, according to the UBS evidence laboratory, since brands have tried to reconcile consumer withholding with higher input costs after an increase in the covid era in prices.

Finally, the mixture of categories remains a fundamental factor in the divided luxury image, with the attractiveness of the brand playing a role as important as the type of product itself.

The jewelry is still a winning play for the owner of Cartier Richemont, even when high -end watches, both those of other luxury watchmakes, remain a weak point.

The owner of Tiffany LVMH, however, continues to fight against smoothness in his jewels and fashion items and leather items, despite leather bags that are strength for force for the Hermes Ultra Luxury brand.

Carole Madjo, head of European Research of European Luxury Assets, told CNBC that he hopes that domain of leather items will continue playing when Hermes informs Wednesday.

“[Hermes] It is always very good, thanks to leather items mainly, “he told” Squawk Box Europe “on Tuesday.

Meanwhile, investors will be waiting anxiously more color on Tuesday by the owner of Gucci Keing in their product review under the artistic director Demna Gvasalia and the incoming CEO Luca de Meo.

“Bring novelty, something fresh that has not been seen before, I think what could make Gucci great again,” Madjo said.