LVMH (MC.FR), the world’s largest luxury goods group, released its first-quarter 2026 results on Monday and disappointed the market. Revenue came in at €19.12 billion, compared to analysts’ estimates of €19.49 billion, while organic growth stalled at just 1% versus the expected 1.5%. The main culprit turned out to be the armed conflict in the Middle East, which has been ongoing since late February, directly weighing on the group’s results and reinforcing the deep discount at which LVMH trades relative to its peers, such as Kering and Hermès.
LVMH controls more than 60 companies that collectively manage 75 luxury brands grouped into five segments. In fashion and leather goods, these include Louis Vuitton, Dior, Fendi, Celine, Givenchy, Loewe, and Kenzo; in watches and jewelry, TAG Heuer, Hublot, Zenith, Bvlgari, Chaumet, and Tiffany & Co. The portfolio is rounded out by spirits (Moët & Chandon, Dom Pérignon, Hennessy, Veuve Clicquot), perfumes and cosmetics (Guerlain, Benefit, Fenty Beauty), and selective distribution led by Sephora.
Source: LSEG
Results
The conflict in the region, which accounts for approximately 6% of the group’s revenue, has caused an average drop in foot traffic at shopping malls of about 50%, with sales at centers such as Dubai plummeting by as much as half. CFO Cecile Cabanis acknowledged that demand in the Middle East remains “very depressed,” and given the region’s high profitability, the blow to margins is likely to be disproportionately large. Below is a comparison of Q1 2026 results with forecasts.
- Total revenue: €19.12 billion vs. expected €19.49 billion — BELOW expectations, -6% YoY (as reported)
- Fashion and leather goods: €9.25 billion, down 2% on an organic basis vs. the expected €9.46 billion — BELOW, the seventh consecutive quarter of decline
- Watches and jewelry: €2.44 billion, +7% organically — ABOVE expectations, driven by Tiffany
- Wine and spirits: €1.27 billion vs. expected €1.23 billion — ABOVE expectations
- Perfumes and cosmetics: €2.04 billion — BELOW expectations
- Selective retail (including Sephora): €4.05 billion vs. expected €4.19 billion — BELOW expectations
The only segments that exceeded forecasts were watches and jewelry, and wines and spirits. The United States remained a bright spot geographically, with organic sales up 3%, while Asia excluding Japan confirmed the improvement in trends observed since the second half of 2025. Source: LVMH Investor Relations
The company’s revenue by geographic region. Source: LVMH Investor Relations
Forecasts
Analysts remain cautiously optimistic about the rest of the year, however. Barclays expects organic growth to rebound to 5% in the second quarter of 2026, pointing to the growing potential of the Dior and Givenchy brands and Sephora’s continued expansion in global markets. However, Jefferies lowered its target price for LVMH shares to €510 from €610, and Deutsche Bank reduced its target to €600 from €620, signaling that the environment remains challenging.
Summary
LVMH shares are down about 2% today and are approaching their lowest levels in over five years, with a cumulative decline of 27% since the start of the year. As the first major luxury company to report earnings this season, LVMH’s results will set the tone for the entire sector, and the market is now eagerly awaiting Kering’s results, to be released today after the market closes, and Hermès’s report on Wednesday morning.
LVMH shares are moving within a clear long-term downtrend since peaking at ~€900 in early 2023. The green band (1st VWAP deviation), which had acted as support for years, was definitively broken at the turn of 2024/2025. The only technical argument on the bulls’ side is precisely the extreme positioning relative to -2 SD and the potential volume support zone at EUR 475–500. Without a recovery to the 635 EUR level (POC) and a return above the lower band of the 1st standard deviation (~590–600 EUR), the technical picture remains structurally bearish. Source: xStation
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