Business · Markets · 10 hrs ago
China boycott weighs on LVMH sales and shares
French luxury group LVMH said revenue from its fashion and leather goods division fell 5% in the third quarter compared with a year earlier.
The company linked the decline partly to weaker demand in China.
Some Chinese consumers boycotted Louis Vuitton, LVMH’s main brand, in July and August.
The boycott followed Louis Vuitton’s win in a trademark case against Chinese tea maker Molly Tea, which some people considered unfair.
Across all its businesses, LVMH’s revenue rose just over 1% to 18.5 billion euros, below analysts’ average expectations on an organic basis.
Its shares fell more than 2% in after-hours trading.
The results add to pressure on LVMH as demand across much of the luxury sector weakens.
A boycott in China contributed to a five percent year-on-year decline in LVMH’s fashion and leather goods revenue in the third quarter on a comparable basis.
LVMH said the division was affected by falling demand in China.
Group revenue grew just over one percent to 18.5 billion euros, missing analysts’ average expectations on an organic basis.
The company’s shares fell by more than two percent in after-hours trading on Tradegate.
Many Chinese consumers boycotted Louis Vuitton in July and August after the brand won a trademark dispute against domestic tea maker Molly Tea.
- Who
- LVMH, the French luxury group, and Chinese consumers who boycotted its Louis Vuitton brand.
- What
- A China boycott and lower demand contributed to a decline in LVMH’s fashion and leather goods revenue. The company’s shares fell after the results.
- When
- The revenue figures were for the third quarter. The boycott took place in July and August; LVMH reported its results on Monday.
- Where
- China; LVMH’s shares also traded on Tradegate.
- Why
- Many consumers considered it unfair that Louis Vuitton had taken the much smaller Molly Tea to court in a trademark dispute.
Chinese consumers who boycotted Louis Vuitton
LVMH
Fairness of the dispute
Chinese consumers who boycotted Louis Vuitton
Some consumers considered it unfair that the global luxury group took the much smaller domestic tea maker Molly Tea to court.
LVMH
Louis Vuitton won the trademark dispute against Molly Tea.
Many Chinese consumers boycotted Louis Vuitton after it won a trademark dispute against Molly Tea.
LVMH’s fashion and leather goods revenue fell five percent year on year on a comparable basis.
LVMH reported its results, with group revenue of 18.5 billion euros.
LVMH shares fell by more than two percent in after-hours trading on Tradegate.
- Fashion and leather goods revenue
- Down 5% year on year on a comparable basis in the third quarter
- Group revenue
- 18.5 billion euros
- Group revenue growth
- Just over 1%
- Tradegate share move
- Down more than 2% in after-hours trading
- Boycott period
- July and August
Sources
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