LVMH Returns to Growth in Q3 2025 as Fashion Slump Narrows and Shares Jump 12%

LVMH reported third-quarter 2025 revenue of €18.28 billion, up 1% on an organic basis, marking the group's first quarterly return to growth after two consecutive quarters of decline. The improvement, driven largely by a rebound in Selective Retailing and steadier trends in Wines & Spirits, Perfumes & Cosmetics and Watches & Jewelry, sent LVMH shares up 12% and lifted the broader European luxury sector, even as the core Fashion & Leather Goods division remained in negative territory.

A Sequential Turn After a Rough Start to the Year

According to figures published by LVMH, organic revenue growth moved from -3% in the first quarter and -4% in the second quarter to +1% in the third quarter. Our calculation, using those reported figures: +1% minus -3% equals a four-percentage-point swing in organic growth between the first and third quarters. For the first nine months of 2025, cumulative revenue stood at €58.09 billion, down 2% organically and down 4% on a reported basis versus €60.75 billion in the same period of 2024.

LVMH said the quarter showed an improvement across all business groups and all regions with one exception: Europe, where revenue tied to tourist spending declined, which the company attributed to currency fluctuations that weighed more heavily on the quarter than earlier in the year.

Fashion & Leather Goods Still in Decline, but Trends Improve

The group's largest and most closely watched division, Fashion & Leather Goods, posted organic revenue down 2% in the third quarter, an improvement on the 6% organic decline recorded over the first nine months of the year. LVMH attributed part of the gap to a difficult year-on-year comparison, noting that 2024 had been boosted by strong growth in tourist spending, particularly in Japan, while the latest quarter reflected what the company described as good resilience with local customers.

Elsewhere, the picture was more positive. Wines & Spirits returned to organic growth of 1% in the quarter, a reversal from a 4% organic decline over the first nine months. Perfumes & Cosmetics and Watches & Jewelry each grew 2% organically. Selective Retailing was the standout, up 7% organically, the strongest of any division, a figure CNBC also flagged as the quarter's top performer.

Within Selective Retailing, LVMH credited Sephora with what it called a remarkable performance, pointing to continued market-share gains and a record-breaking launch for the Rhode brand. The company also said DFS revenue trends improved in the quarter, particularly in Macao and Hong Kong.

Regional Demand: Steady in the West, Mixed in Asia

LVMH said Europe and the United States remained stable compared with the first nine months of 2024, supported by what it described as solid local demand. Japan was down against a year-earlier period that had been lifted by tourist spending tied to a much weaker yen. The rest of Asia, excluding Japan, saw what the company called a noticeable improvement in trends relative to 2024.

On Wines & Spirits specifically, LVMH said cognac trends so far in 2025 have resembled those of 2024, pointing to the continued impact of trade tensions weighing on demand in the category's two key markets, the United States and China. CNBC separately linked the division's quarterly recovery to an easing of earlier uncertainty tied to China's levies on European Union cognac and new U.S. import tariffs.

Market Reaction: Shares Jump, Sector Follows

LVMH shares popped 12% the day after the release, according to CNBC, pulling the broader European luxury sector higher. The Stoxx Europe Luxury 10 index added more than 6% on the session. Among peers, Moncler ended the day up 8%, Kering, owner of Gucci, rose 4.8%, and Burberry gained 3.4%. Shares in Christian Dior, the Arnault family's holding company with a controlling stake in LVMH, were around 12% higher as well, CNBC reported.

Sell-side reaction was broadly positive. Bernstein said LVMH had delivered beats across all divisions, assigning the stock an Outperform rating with a price target of €700, per CNBC's reporting. RBC Capital Markets raised its target from €550 to €575, also rating the shares Outperform, while cautioning that the recovery shape from here is unlikely to be linear, according to the same CNBC report. These are analyst views reported by CNBC and should be read as third-party assessments rather than confirmed outcomes.

Reading the Rebound: An Interpretation

Taken together, the divisional and regional detail suggests the quarter's return to growth was driven more by divisions outside Fashion & Leather Goods — Selective Retailing in particular, up 7% organically — than by a recovery in the group's largest division, which was still down 2% organically. In our reading, the scale of the share-price reaction, the 12% single-day move reported by CNBC, looks large relative to a headline growth rate of just 1%, and likely reflects how depressed expectations had become after two quarters of outright decline (-3% in the first quarter and -4% in the second). Whether the improvement marks a durable inflection or simply a less unfavorable comparison base — LVMH itself pointed to a tough 2024 comparison in Fashion & Leather Goods, boosted by tourist spending, particularly in Japan — is not established by this single quarter of data.

Outlook

LVMH said that in what it called an uncertain economic and geopolitical environment, the group remains confident and will maintain a strategy focused on enhancing the desirability of its brands, product authenticity and quality, retail excellence, and an agile organization, according to the company's own statement.

Bottom Line

LVMH's third quarter marked a return to organic growth after two down quarters, powered by Selective Retailing's 7% gain and smaller improvements across Wines & Spirits, Perfumes & Cosmetics and Watches & Jewelry, even as Fashion & Leather Goods stayed negative. The market's 12% single-day share jump, and the sympathy rally across Kering, Burberry and Moncler, signals that investors had priced in a weaker outcome. Whether this is the start of a sustained turnaround in luxury demand, particularly in the core leather goods business, remains an open question that will depend on how trends in Asia and Europe evolve in subsequent quarters.