(BFM Bourse) – The Swiss group delivered activity well above expectations for its third quarter, ended at the end of December, with growth of 10%. The title soars on the Zurich Stock Exchange and propels LVMH, Hermès and Kering to Paris.
The luxury earnings season has kicked off. Although we will still have to wait for the publications of the French groups – LVMH will deliver its accounts on January 28, followed by Kering and Hermès – the Swiss Richemont submitted its copy this Thursday, January 16.
The activity of the owner of the Van Cleef & Arpels, Cartier and IWC brands was eagerly awaited to take the pulse of a suffering sector. In the third quarter, the slowdown in demand for luxury goods increased. LVMH sales fell by 3% on a comparable basis.
Richemont did not disappoint. In the third quarter of its 2024-2025 financial year, a period which runs from October to the end of December and is therefore comparable to the fourth quarter of other luxury groups, the company generated revenues of 6.15 billion euros. This reflects growth of 10% both in published data and at constant exchange rates.
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The action takes off
The Swiss company did not beat expectations. She atomized them. According to a consensus cited by Deutsche Bank, analysts expected an increase of only 1% excluding currency effects.
“Richemont massively beat expectations in the third quarter in its two main divisions and in most regions,” notes the German bank.
“We expect these results to have a positive impact on the entire luxury sector, with positive reactions to share prices,” Royal Bank of Canada wrote in a note published before the market opened. .
On the Zurich Stock Exchange, Richemont shares jumped 16%. The Swiss company draws all of luxury in its wake. In Paris, Kering takes 7.7%, LVMH 7.7% and Hermès 5.2%.
“Exceptionally strong”
Outside of Asia-Pacific, where sales contracted by 7% excluding currencies (compared to -14% expected by consensus), Richemont recorded impressive growth across all of its regions.
In Europe, revenues increased by 19% excluding exchange rates (compared to 6% expected by the consensus), while they increased by 19% in Japan and 22% in the “Americas” zone, against expectations of 10 % in the latter region.
By division, jewelry (73% of revenues) saw its sales increase by 14% on a comparable basis while watchmaking (14%) saw its revenues decline by 8%.
“We consider these results to be exceptionally solid. For its main activity as a jewelry house, Richemont achieved very good performances, benefiting from strong momentum at Cartier and Van Cleef in particular, in a more favorable context for the jewelry category, according to us”, judge Royal Bank of Canada.
-“Hard luxury”
Richemont has the advantage of evolving in the “hard luxury” niche (watchmaking, jewelry as opposed to soft luxury which includes leather goods and clothing), a segment which better weathered the luxury storm last year. . This is because “hard luxury” has less exposure to so-called “aspirational” customers, oriented towards less expensive products and more sensitive to the economic situation.
Which means that the comparison between Richemont and other luxury companies, more focused on leather goods, must be a little nuanced.
“The entire sector should react positively today, but we note that the implications for other categories, particularly leather goods, may be risky to extrapolate,” UBS warned in a note published before the market opening.
But the significant gap between expectations and the growth published by Richemont is enough to fuel hopes for all luxury goods.
For Deutsche Bank, Richemont's publication “will reinforce debates that the most high-end luxury brands are likely to outperform, the luxury slowdown is more cyclical than structural (at least at the high end) and growth in the rest of the world is enough to compensate for China's weakness.
The group's robust activity in the “Americas” region also constitutes a new positive signal for the United States. HSBC estimates that the country soon to be presided over by Donald Trump will be the lifeline of luxury in 2025, expecting growth of 7% in the United States. This region was the first to be hit by the slowdown in demand for luxury goods and could also be the first to recover.
“Luxury consumption in the United States is finally starting to realize its potential and the country is likely seen as the hotspot for most brands in 2025,” Deutsche Bank wrote in December.
After Richemont's results and before those of LVMH, investors will watch Burberry's publication on January 24.
Julien Marion – ©2025 BFM Bourse
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