Hermes Sales Rise 15.6%, Defying Luxury Downturn as US Posts Strong Growth

A model presents creations by designer Veronique Nichanian as part of her Menswear ready-to-wear Spring/Summer 2024 collection show for fashion house Hermes during Men's Fashion Week in Paris, France, June 24, 2023. REUTERS/Gonzalo Fuentes
A model presents creations by designer Veronique Nichanian as part of her Menswear ready-to-wear Spring/Summer 2024 collection show for fashion house Hermes during Men's Fashion Week in Paris, France, June 24, 2023. REUTERS/Gonzalo Fuentes
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Hermes Sales Rise 15.6%, Defying Luxury Downturn as US Posts Strong Growth

A model presents creations by designer Veronique Nichanian as part of her Menswear ready-to-wear Spring/Summer 2024 collection show for fashion house Hermes during Men's Fashion Week in Paris, France, June 24, 2023. REUTERS/Gonzalo Fuentes
A model presents creations by designer Veronique Nichanian as part of her Menswear ready-to-wear Spring/Summer 2024 collection show for fashion house Hermes during Men's Fashion Week in Paris, France, June 24, 2023. REUTERS/Gonzalo Fuentes

Third quarter sales at Birkin bag maker Hermes rose briskly, up 15.6% year-on-year, with the pace of growth slowing only slightly in a show of resilience of its wealthy clientele in spite of economic headwinds.
Sales for the three months to the end of September stood at 3.37 billion euros ($3.60 billion), a 15.6% rise at constant exchange rates, beating a Visible Alpha consensus for 14% growth, with brisk sales in all regions, particularly in the United States, said Reuters.
Analysts have lowered their estimates for the luxury sector in recent weeks, following a sales report from bellwether LVMH earlier this month showing shoppers are splurging less on high end fashion as inflation and economic uncertainty rise.
But Hermes, which caters to shoppers who can afford handbags like the coveted $10,000 plus Birkin model, has a reputation of weathering economic turbulence better than rivals.



Hermes 2Q Sales Rise 13% on Continued Appetite for High-End Luxury

People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
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Hermes 2Q Sales Rise 13% on Continued Appetite for High-End Luxury

People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)

Birkin-bag maker Hermes reported a 13% rise in second-quarter sales on Thursday, demonstrating the continued appetite from wealthy shoppers for its luxury handbags, even as less affluent consumers pull back.

Sales at the French luxury group grew to 3.7 billion euros ($4.02 billion), a 13% organic sales rise that strips out currency fluctuations. The figure was in line with analyst expectations, according to a Visible Alpha consensus.

Operating profit for the first half was 3.1 billion euros, compared to a forecast from consensus provider Visible Alpha for 3.2 billion.

One of the most steady performers in the luxury goods sector -- even as economic conditions worsen -- the French group's results stand out after a string of disappointing earnings updates from peers which have raised investor concern about uncertain prospects for the sector in the coming months.

Hermes' famously classic designs and tight management of production and stock have helped reinforce the label's aura of exclusivity, and CEO Axel Dumas told reporters the company had seen "no big interruption in trends".

However, he said Hermes was seeing slightly less traffic with aspirational clients, which was impacting higher volume products like fashion accessories.