LVMH Moët Hennessy Louis Vuitton touted a “good start” to the year, reporting 18 billion euros ($19.59 billion) in revenue for the first quarter of 2022, up 29 percent compared to the same period in 2021, and stating that it is “well positioned to continue to gain market share” in the luxury sphere. Despite “continued disruption from the health crisis and the dramatic events in Ukraine,” the French luxury goods conglomerate revealed that all of its business groups – from Fashion & Leather Goods to Selective Retailing – achieved double-digit revenue growth, except for Wines & Spirits, which continued to see supply constraints. 

Delving into its biggest division, LVMH stated on Tuesday that Fashion & Leather Goods, which is responsible for just upwards of 50 percent of the group’s total revenues, recorded revenues of 9.12 billion euros for the first three months of the year. The group pointed to Louis Vuitton, which had “an excellent start to the year,” Dior, which “enjoyed another remarkable performance,” Fendi’s “solid growth, driven in particular by the success of Kim Jones’ collections,” and Celine, which achieved “very strong growth thanks to the remarkable success of its ready-to-wear and leather goods lines designed by Hedi Slimane.” Loro Piana, Loewe, and Marc Jacobs “all had a very good quarter,” per LVMH. 

A standout in terms of growth within the Fashion & Leather Goods division is Dior, with Bernstein analyst Luca Solca stating in a note on Wednesday that the brand is doing “somewhat better” than the others within the division. As for Louis Vuitton, he states that management does not intend to be overwhelmed by demand,” as they have a lot of initiatives in place for supply to keep up with demand, like the two new precious leather workshops in Vendôme, France.” At the same time, “The strategy remains that of controlling volumes.” 

In a call on Tuesday, LVMH Chief Financial Officer Jean-Jacques Guiony specifically cited the strength of Dior, noting that Dior and Celine grew faster than other labels. Although, top-earner Louis Vuitton “is never very far from the average for the division.”

LVMH Revenue

Within the realm of Watches & Jewelry, which recorded organic revenue growth of 19 percent year-over-year, with revenues reaching 2.34 billion euros, Tiffany & Co. had “an excellent start to the year, still driven by strong growth in the United States.” The new Knot collection was particularly successful, according to LVMH, which is currently in the midst of a major youth-focused overhaul at Tiffany & Co. under the watch of EVP of Product and Communications, Alexandre Arnault. Bulgari was another standout, thanks to strong demand – for both it and Tiffany & Co. – in the U.S. and Europe, as well as Singapore and Korea. 

LVMH noted “strong growth of perfume and makeup, robust progress in the U.S. and a rebound in Europe,” with the division generating 1.91 billion euros, up from 1.55 billion euros for the same quarter last year. 

Elsewhere under the LVMH umbrella, the Selective Retailing division, which is home to the likes of beauty retailer Sephora and duty-free chain DFS, among others, generated 3.04 billion euros in revenue, up 30 percent compared to Q1 2021. Specifically, LVMH cited strong performance from Sephora, which demonstrated a “solid performance in stores, especially in North America, France and Middle East,” driven in large part by fragrance sales and the “recovery of makeup.” At the same time, DFS – which has been hit significantly in the wake of the pandemic and limited international travel, saw revenue increase but “at a lower level” amid the continued impact of the pandemic on travel.

Geographically speaking, LVMH revealed that the United States up 26 percent), Europe (up 45 percent), and Japan (up 30 percent) achieved double-digit revenue growth, while Asia (up 8 percent) continued to grow over the quarter even in the wake of tightening health restrictions in China in March. The group pointed to a “balanced geographic revenue mix,” with 37 percent of Q1 sales coming from the Asian market (excluding Japan), 24 percent coming from the U.S. and 14 percent coming from Europe (excluding France), followed by sales in “Other Markets” (12 percent), Japan (7 percent), and France (6 percent). 

Solca emphasized the importance of the U.S. market, which is “the largest country in terms of percentage revenue for LVMH – even more so than Mainland China.” He further states that this U.S. market is currently “less dependent on cosmetics than several years ago, as makeup has seen some slowdown in the past years and has been replaced by other categories under cosmetics and Fashion & Leather Goods.” 

In terms of e-commerce, LVMH reported that it continued to see “strong momentum of online revenue and omnichannel developments” in Q1, with e-commerce sales in the U.S., for instance, remaining above 2019 levels even though they are slowly normalizing in favor of brick-and-mortar sales. 

And finally, in a brief note on the metaverse, LVMH management stated that it is difficult to comment on this as of now, but confirmed that the group is eyeing the space “very carefully,” and stated that the group “will be part of whatever the future holds for the metaverse.” 

Nike reported on Monday that its revenues for the third quarter ending on February 28 totaled $10.9 billion, up 5 percent on a year-over-year basis, enabling the sportswear titan to beat analysts’ expectations of sales of $10.59 billion. Sales for the three-month period were driven in large part by sales in North America (up 9 percent in Q3) and double-digit growth (up 19 percent year-over-year) for its digital business, and thanks to more full-price sell-throughs, Beaverton, Oregon-based Nike generated a gross margin of 46.6 percent, up from 45.6 percent for the same quarter last year. And finally, the company noted that sales within its wholesale network were down by 1 percent in Q3, as it continues to prioritize its own retail operations. 

In a corresponding earnings call on Monday, NIKE, Inc. president and CEO, John Donahoe stated that Nike’s success in Q3 “amid the dynamic macroeconomic environment,” gives the company confidence in its long-term outlook. CFO Matt Friend stated that Nike “continue[d] to expect revenue for the full year to grow mid-single digits versus the prior year,” but noted that “specifically for Q4 in North America, we expect a decline in revenue due to year-over-year comparisons. And in Greater China, we expect to see another quarter of sequential improvement while we closely monitor the operational impact related to recent COVID lockdowns.” 

Addressing Nike’s enduring emphasis on building out its own retail strategy that is less reliant on wholesale, Donahoe stated that Nike will, in fact, “continue to build strategic partnerships with our wholesale partners,” with Friend noting that Nike is working to “create the marketplace of the future, both through digital, our owned stores and our partners,” which will require Nike “to also invest with our partners in their consumer experiences so that the consumer has a premium consistent experience as they move across the marketplace and can find the NIKE product when and where they want it.” 

In terms of Nike’s e-commerce sales, which were up by 22 percent a currency-neutral basis in Q3, Donahoe stated that as “consumers continue to shift toward digital to find the products they love,” the digital experience Nike is offering up “particularly through [its] app ecosystem” – continues to build “deep consumer connections and capture digital market share.” In particular, he pointed to the NIKE mobile app, which “was up more than 50 percent in the quarter and overtook on mobile for our highest share of digital demand.” At the same time, “SNKRS continues to gain momentum, particularly as its strong consumer engagement leads to improved conversion.” 

And at the same time, Donahue contends that “growing participation in new digital platforms” is underway for Nike, including efforts in the metaverse, which Donahoe says “lets us create innovative ways to connect with consumers, letting them unlock virtual experiences, products and rewards as we expand access points to NIKE across the digital ecosystem.” Among those efforts is NIKELAND, which the Swoosh launched on the Roblox metaverse platform in mid-November.

Since its launch on Roblox, which marks one of the biggest moves by Nike to date when it comes to the metaverse, Donahoe revealed that “a total of 6.7 million players from 224 countries have visited NIKELAND,” with the company “planning to continue driving energy there with virtual products like LeBron 19 styles special to Roblox.” 

In addition, Donahoe asserted that Nike announced NIKE Virtual Studios this quarter, following its acquisition of RTFKT. “With NIKE Virtual Studios, our vision is to take our best-in-class experiences in digital and build Web 3 products and experiences to scale this community so that NIKE and our members can create, share and benefit together,” he stated. In Q3, Donahoe says that RTFKT released the first official NIKE-branded NFT, which marks “our first step into the world of digital product creation.” Nike management is “pleased by the positive momentum and energy we’re already seeing in the space, and we’re excited about the future as we continue to extend our digital leadership in the industry,” per Donahoe. “In the end, NIKE is doing what we always do. We are staying on the offense.”

Prada released its full-year revenue for 2021, highlighting a “very strong second half of 2021 marked by an acceleration in retail sales with a sharp increase in profitability and a strong cash flow generation.” The Italian group reported revenue of 3.36 billion euros ($3.69 billion) for the year, up 41 percent from in 2020 and up 8 percent from 2019, and profit that rose to 294 million euros ($322.52 million) compared with a net loss of 54 million euros ($59.24 million) in 2020. The Prada and Miu Miu owner pointed to a rise in full-price sales and local spending for the second half of the year, strong results across all product categories, and “outstanding” growth in online sales, which grew by 5x compared to 2019, and now generate 7 percent of the group’s total sales. 

In terms of sales by region, Asia Pacific sales amounted to 1.19 billion euros ($1.31 billion), up 29 percent compared to 2020 and 30 percent compared to 2019, with sustained demand coming from key markets throughout the period compared 2019. Sales in China, for example, were up by 56 percent compared to 2019, topped only by “Korea (up 90 percent) and Taiwan (up 61 percent),” according to Prada’s report. Meanwhile, in the Americas, where Prada’s customers are the youngest, sales saw a “sharp increase throughout the year,” reaching reached 572 million euro, up 103 percent compared to 2020 and 69 percent compared to 2019. Still yet, sales in Europe stood at 749 million euro, up 35 percent compared to 2020 and down 11 percent compared to 2019. Prada noted that “the trend turned positive in H2, up 2 percent compared to 2019,” and the EU region seeing “strong progress across all countries.” 

Reflecting on Prada’s results, Bernstein analyst Luca Solca stated in a note on Monday that the group’s marquee Prada brand “led performance with 21 percent organic growth vs. FY19 and 29 percent vs. 4Q19,” putting Prada “in line with Moncler (+30 percent) and above Burberry (-3 percent) in 4Q21.” At the same time, the group’s smaller brands, including Miu Miu (-7 percent organic growth vs. FY19) and Church’s (-41 percent organic growth vs. FY19), “have yet to recover above [pre-pandemic] 2019 levels.”  

“The Prada Group’s start to 2022 has been strong,” chief executive officer Patrizio Bertelli stated on Monday. “Our long-term strategy is on track, focused on distinctive brand identity, product quality and industrial know-how, direct distribution, and sustainability at the core of our values. Decisive actions to evolve the business and navigate the changing luxury market drove outstanding growth and increased profitability in 2021.” 

The results come as Prada has been aiming to boost annual revenue to 4.5 billion euro ($4.94 billion) for the “medium-term,” with an operating margin target of approximately 20 percent. In furtherance of this, the group stated in November that it is angling to double its online penetration to 15 percent of retail revenue and increase retail sales density by 30 percent to 40 percent. Shedding light on how it plans to achieve such growth, Prada revealed last winter that from a brand point of view, it is looking to “consolidate strong awareness by leveraging its brand pillars,” and boost its marketing investment in digital and experience in order to “sustain and convert customers focus.”

In terms of product, Prada’s management previously stated that it is “investing in iconic products and newness” simultaneously, including by launching new categories, such as beauty, fine jewelry, and home goods, and doubling down on its sportswear-centric Linea Rossa collection in order to achieve “full potential” there. Finally, Prada said that it plans to accelerate within the customers pools that are driving market growth, namely, Gen-Z buyers, as well as those in China and the U.S.

In an earnings call on Monday, Prada confirmed its focus on bolstering its ominichannel approach, including by investing in both digital and retail operations, as well as its aim to attract younger consumers, especially in the U.S., where it is looking “not to maintain the current growth rate in the US, but to secure future customers by acquiring more young customers,” per Bernstein.

As for the the year so far, sales for 2022 are looking encouraging, per Prada, even in light of “uncertainty” due to Russia’s invasion of Ukraine. As of now, the group says that it has halted all operations in Russia, but noted that the impact is limited “even under the worst scenario,” which would see it “write off the limited inventories.” As highlighted by Bernstein, Prada Group management “indicated their interest in continuing to operate in Russia if the situation allows in future.”

Revenues for Hermès were up by 42 percent at constant exchange rates to €8.98 billion in 2021, the French luxury goods reported on Friday, up 42% at constant exchange rates and 41% at current exchange rates compared to 2020. Recurring operating income grew by 78 percent to €3.53 billion and net profit reached €2.445 billion, up 77 percent compared to 2020. Meanwhile, sales slowed in Q4 of 2021, with leather goods sales lagging by 5.4 percent compared to Q4 in 2020, prompting the Birkin bag-maker to miss analyst expectations of 12 percent growth on sales for the 3-month period by one percent. Hermès cited “capacity constraints” for its in-demand offerings as the culpit. 

Looking at its annual revenues on a regional basis, Hermès reported that Asia and America recorded “the highest growths, compared to 2020 as well as to 2019,” while Europe returned to growth compared to 2019. Sales in the Asian region (not including Japan) were up by 45 percent compared to 2020 and 65 from 2019. In America, Hermès reported sales growth of 57 percent and 24 percent compared to 2020 and 2019, respectively, citing “a strong performance, despite the sanitary restrictions imposed in several US cities in the fourth quarter.” 

In terms of product categories, Hermès asserted that as of the end of 2021, all the business lines “confirmed their growth, with a noteworthy increase in Ready-to-wear and Accessories, Watches and Other Hermès Business Lines (Jewellery and Homeware).” As usual, Leather Goods and Saddlery division sales were “exceptional,” up by 29 percent and 23 percent from 2020 and 2019 thanks to sustained “demand both for new bags like Della Cavalleria and 24/24 and the Hermès classics.” 

Annual sales by product category

Ready-to-wear and Accessories sales were up by 59 percent and 44 percent from 2020 and 2019 “thanks to the success of the ready-to-wear, fashion accessories and footwear collections;” Silk and Textiles business line “performed well” with growth of 49 percent and 15 percent from 2020 and 2019; Perfumes and Beauty sales were up (+47% and +19% from 2020 and 2019); the Watches business line continued to grow (+73% and +77% from 2020 and 2019); and quite strikingly, “Other” Hermès business lines, which includes Jewellery and Homeware, the latter of which has performed particularly well amid pandemic lockdowns, were up by 57 percent and 95 percent compared to 2020 and 2019.  

Speaking about Hermès’ revenues on Friday, Executive Chairman Axel Dumas addressed the volume growth caps that exist for its leather goods offerings, which stand at 6 to 7 percent annually, with Hermès “preferring to have long waiting lists for its products rather than accelerate production,” per Reuters. Dumas said the group has no plans of changing that despite adding new employees each year and expanding production facilities. 

“It takes 15 hours [to create an] Hermès bag,” Dumas stated. “Even if there’s a lot of demand, I’m not going to start doing them in 13 hours to raise production.” 

As for the move by luxury players to boost prices over the past couple of months and going further in 2022, Dumas confirmed that Hermès boosted prices across the globe by an average of 3.5 percent, up from its customary 1.5 percent rise, in order to account for increasing production costs in Europe. He notes that the price hike also included “regional price adjustments to account for currency fluctuations.” Setting itself apart from rivals, Dumas stated that Hermès has no plans to increase prices in order to “boost its results,” and noted that “given its hand-crafted production, Hermès is less exposed than rivals to increasing costs of energy and primary materials.”

One more takeaway comes in the form of a spotlight on the U.S. A key focus for both Kering and Hermès in connection with their earnings and future growth is expansion within the U.S. On the heels of Jean-François Palus, Kering Group Managing Director, asserting that Kering has “a significant potential in second- or third-tier cities, and new pockets of wealth such as Atlanta or Nashville or even Austin,” Hermes boasted increases driven by sales in America (+57% and +24% from 2020 and 2019), and pointed to the opening of two new stores in Troy near Detroit in June and in Aventura Mall near Miami in October. This comes amid a 5-year expansion plan for the brand in the U.S., with new stores and renovations of existing stores, including a major revamp of its Madison Avenue store in New York.

All of Kering’s brands saw “sharp sales rebounds” in 2021, the French luxury goods group revealed on Thursday, noting that revenue was “way beyond 2019 levels.” In its full-year report, Kering revealed that its sales grew by 35 percent and 13 percent compared to 2020 and 2019 to €17.6 billion ($20.01 billion). Meanwhile, the François-Henri Pinault-led group – which owns Gucci, Balenciaga, Bottega Veneta, and Saint Laurent, among other brands – reported that recurring operating income “rose sharply,” by 60 percent compared to 2020, to reach a new record of €5.02 billion ($5.71 billion), and recurring operating margin “retrieved a high level” at 28.4 percent. 

Looking at the group’s individual product categories, Leather Goods represented 50 percent of Kering’s revenue in 2021 (down from 52% in 2020 and 55% in 2019), and was “probably one of the categories most exposed to fluctuations in tourism,” which is why it “posted weaker sales growth than the other categories.” Kering noted that its Leather Goods performance “should be analyzed in the view of the very high base for comparison in 2019, as well as the houses’ prudent inventory management in 2020, which led them to limit the number of product lines and amount of stock available in stores in 2020 and for part of 2021.” Shoes followed with 21 percent of sales for 2021 (up from 21% in 2020 and 18% in 2019), and then ready-to-wear, which generated 15 percent of sales (the same as 2020 and up 1% from 2019). 

Sales for the group came primarily from the Asia-Pacific region, which generated 39 percent of sales in 2021, followed by 27 percent from North America, and Western Europe, which generated 22 percent of Kering revenue, and from its own retail operations. “Distribution is becoming increasingly exclusive, which means that the revenue contribution of the wholesale channel is gradually decreasing,” per Kering, which reported that 81 percent of 2021 revenues came from retail, with retail sales increasing by 40 percent year-over-year and 18 percent from 2019. (Brands across the board appear to be using the pandemic period as a time to drive home existing distribution restructuring efforts.)

Still yet, e-commerce continues to grow for the group, with online sales topping $2 billion in 2022, with online revenue growing by 55 percent year-over-year.


Delving into its three biggest brands, Kering reported that Gucci – which drives the bulk of Kering’s sales and whose prices have on average been boosted substantially – enjoyed “a year of sustained growth.” The Italian brand’s revenues in Q4, alone, grew by 32 percent, quite a jump from analysts’ expectations of 18 percent. The quarterly sales boost came from “the success of its iconic lines, along with an intense schedule of events and new product launches,” including for Aria, the brand’s Balenciaga mashup collection. For the year, Gucci’s revenue rose 31 percent to €9.73 billion ($11.07 billion). Gucci’s recurring operating margin rose by 3.1 points to 38.2 percent. 

An interesting note about the Aria collection, according to a note from Bernstein on Thursday: Sales of Aria products in Gucci stores are accounted for as revenues for Gucci and sales in Balenciaga stores as Balenciaga revenues. However, the majority of sales are Gucci due to its relative size and retail footprint.

In a nod to its enduring effort to overhaul its distribution and phase out much of its wholesale efforts and focus on its own retail sales (a whopping 91% of sales came from directly operated stores in 2021), Gucci’s 2021 retail network sales grew 37 percent and 10 percent compared to 2020 and 2019, respectively, and wholesale revenue was down by 10 and 39 compared to 2020 and 2019. (Gucci is the first Kering name to embark on a drastic wholesale “streamlining,” and should complete this effort within 2022.)

As for Gucci’s sales by region, Kering stated that sales in 2021 rebounded “very strongly” in North America, growing by almost 67 percent compared to both 2020 and 2019. Revenues from North America account for 27 percent of sales, topped by Asia-Pacific with 44 percent. Growth in the Asia-Pacific region grew 29.5 percent year-on-year, with regional growth mainly driven by Mainland China, which saw firm increases in both online and in-store sales.

In a corresponding earnings call on Thursday, Kering management stated that Gucci’s growth is expected to carry on through 2022, which will see the brand continue to increase prices and boost its product mix, including by way of more Aria-like drops in stores. 

Saint Laurent 

Kering reported Saint Laurent generated €2.52 billion ($2.86 billion) in revenue for the year, up 45.6 percent and 26 percent at constant exchange rates relative to 2020 and 2019 respectively, driven by sales in North America (34%), Asia-Pacific (28%), and Western Europe (27%). Sales from directly operated stores “grew sharply” in 2021, up 55 percent compared to 2020 and 35 percent over two years, per Kering, while wholesale revenue was 23 percent higher than in 2020 and 6 percent higher than in 2019, as the brand “also started streamlining its third-party distribution.” 

For the product breakdown, sales at Saint Laurent, which is Kering’s second-largest house, are driven significantly by leather goods (a striking 72%), followed by ready-to-wear (12%), and footwear (9%), and the Kering noted that online sales proved to be a significant driver of sales, growing for a third year in a row. 

Saint Laurent is garnering a lot of attention from Kering management, which said on Thursday that it is the next house to join the realm of the “mega-brands,” particularly as its growth potential is “highly underestimated,” including in China. In short: the brand is on an “exceptional growth path.”

Bottega Veneta 

Bottega Veneta’s 2021 revenue hit an “all time high” of €1.5 billion ($1.71 billion), up 25 percent compared to 2020 and 32 percent compared to 2019, with sales driven by Asia, where its desirability has continue to increase (39%), Western Europe (24%), and then North America (18%). According to Kering, “Trends that emerged in 2020 were confirmed in 2021: in Western Europe and North America – where local customers were the first to be won over by the House’s new creative direction – sales were very strong throughout the year. Bottega Veneta’s desirability also continued to increase in Asia.” Kering highlighted the brand’s success in North America, in particular, where sales were up by 83.3 percent compared to 2020 and 67 percent compared to 2019. “This is an outstanding performance given the House’s market position and its offering, which is generally less aspirational than that of other Group brands.”

With a category breakdown that somewhat mirrors Saint Laurent’s, Bottega generates 71 percent of sales from its leather goods, followed by 18 percent from shoes, and 9 percent from ready-to-wear. 

Management’s focus here appeared to be on the “confirmed potential” of Bottega as a key brand, and against that background, plans to boost profitability. Kering stated that profitability for Bottega “is expected to continue improving gradually.” Margins came to 19.1 percent (up 4.9 points from 2020 and up 0.7 points from 2019), an increase that was driven by “positive operational leverage, even though the house invested heavily in 2021 to make its revamp a lasting success.” 

Other Houses 

Balenciaga had “another record year,” per Kering. “In particular, the leather goods offerings of Balenciaga and Alexander McQueen expanded and attracted new customers. As a result, sales in that category grew strongly.” Ready-to-wear “also delivered rapid sales growth, primarily driven by menswear collections,” while “shoes once again saw particularly strong growth in 2021, driven by the appeal of the Balenciaga and Alexander McQueen collections.” 

Reflecting on the year, Kering stated that among other things, Balenciaga, which is “gaining in distinctiveness and prestige,” has been “exploring new business models and developing new modes of engagement,” the latter of which has included an influx of Kardashian and Kanye West marketing.

M&A and Metaverse

During Thursday’s call, Pinault shed light on future M&A, stating that Kering’s “portfolio of brands is not perfect, so I can improve it significantly going forward.” The group is actively scoping out acquisition targets based on “patience, being opportunistic and most importantly, being lucid.” As for the metaverse, Kering’s chairman asserted that the group is “considering how the virtual world could potentially disrupt e-commerce,” as well as provide more opportunities for it to extend its products. At the same time, CNBC notes that Pinault revealed that Kering is considering how it could accept cryptocurrency as a payment at some point going forward.