On the heels of Fashion Month, French conglomerate LVMH acknowledged what the industry has been feeling for months: the luxury sector is slowing down. However, in their Q3 2024 earnings call, the owners of Dior and Louis Vuitton shared a bright spot amid the overall decline. It was a fragrance. LVMH reported that in the first nine months of 2024, its perfume and cosmetics division’s revenue increased by 5% compared to the same period in 2023, reaching 6.1 billion euros ($6.6 billion) in revenue.
However, the fragrance boom won’t last forever. LVMH reported a 3% increase in perfume and cosmetics revenue in Q3 2024, but that number failed to maintain the momentum of Q1 2024 and fell compared to Q1 2023. increased by 7%. In the second quarter of 2024, LVMH saw sales of perfumes and cosmetics increase by 4% compared to the same period last year.
Two years after the domestic violence trial against longtime ambassador Johnny Depp became a media sensation, LVMH said Dior Sauvage remains its strong seller for the third quarter of 2024. It was reported that In August, LVMH launched a water-based version of its popular men’s fragrance. Dior also launched its first campaign in August, featuring Rihanna as the new ambassador for its women’s fragrance J’adore. LVMH continued to enhance its fragrance offerings at other fashion houses throughout 2024. In May, Fendi announced its expansion into luxury fragrances, launching seven fragrances with a retail price of $330, tapping into demand for increasingly premium perfumes. Celine launched the Elephant scent in April, along with hair perfume and scented body lotion versions of its existing perfume. In addition to the beauty departments of fashion houses such as Dior and Louis Vuitton, LVMH also owns fragrance brands such as Maison Francis Kurkdjian and Guerlain.
However, LVMH reported that perfume brands are struggling in China due to the illegal import market for perfumes. “We need to[address parallel markets]so that our brand value is not compromised,” said Cecile Cabaniss, deputy finance director.
The increase in perfume and cosmetics sales follows a continued slump in luxury goods sales at fashion houses, with LVMH reporting a 1% decline in sales for the first nine months of 2024 compared to the same period in 2023. This is in stark contrast to what is happening. In the third quarter, sales were down 5% in the fashion and leather goods sector. LVMH has also experienced its most high-profile creative director change in recent weeks, with Hedi Slimane stepping down as Celine’s creative director in early October and Michael Ryder quickly announced as his replacement. Ta. In the same month, Kim Jones announced his departure from Fendi, but will remain at Dior, where he leads menswear.
LVMH reported that its beauty retail giant Sephora continues to maintain momentum across all markets. However, in September, it was reported that the company’s head of selective retailing, Chris de La Puente, was planning to retire at the end of October.