Dive Brief:
- Hermès revenue was up 12% to 7.5 billion euros, or about $8.1 billion, in the first half of fiscal 2024, according to a Thursday earnings report.
- Revenue in Europe and the Americas grew by low double-digits for the period, while Asia was up about 7% as Japan’s 9% growth was tempered by a 6.8% growth rate in the rest of the Asia-Pacific region.
- Middle East revenue grew by 105%, although the region still represents the smallest portion of Hermès’ total market share.
Dive Insight:
Hermès continued to show strength in the luxury sector as several competitors, including Kering and LVMH, have struggled.
“The solid first-half results, in a more complex economic and geopolitical context, reflect the strength of Hermès’ model,” Executive Chairman Axel Dumas said in the release. “The group is confident in the future and is continuing to invest, to pursue its vertical integration projects and to create new jobs, while remaining true to its values.”
The company said in the release that Asia’s H1 revenue performance had to be compared to second-quarter comps from 2023, which were “exceptional, following the lifting of health measures in China.” In addition, first-half results were impacted by a downturn in traffic in China following the Chinese New Year, per the release.
Elsewhere, the company credited a 12% increase in revenue in the Americas to “continued solid momentum in the United States.” The company attributed a 16% boost in sales in Europe excluding France, as well as an almost 15% rise in France sales, to “the loyalty of local customers and dynamic tourist flows.”
By sector, revenue in leather goods and saddlery was up 15.7% due to “the increase in production capacities and particularly sustained demand,” per the report.
In the ready-to-wear and accessories sector, revenue rose 12.5%, while other Hermès sectors including jewelry and home goods rose 15.7% in the first half.
“In a more complex economic and geopolitical context, the group continues its development with confidence, thanks to the highly integrated artisanal model, the balanced distribution network, the creativity of collections and the loyalty of clients,” the company said in its release.
Hermès added that in the medium-term, “despite the economic, geopolitical and monetary uncertainties around the world,” the group confirms an ambitious goal for revenue growth at constant exchange rates.
