LVMH loses steam: revenue down 5.8% and fashion division falls 8.5%

LVMH loses steam: revenue down 5.8% and fashion division falls 8.5%

April 2026. Luxury giant LVMH released its first-quarter results: €19,121 million in revenue, down 5.8% from the previous year. Its flagship division, fashion and leather goods (Louis Vuitton, Dior…), brought in €9,247 million, an 8.5% drop. The war in the Middle East is the official excuse, but traffic data and internal decisions tell a different story.

The dividend's "consolation prize"

The stock fell 4% on Wall Street after the results, and those who defend holding it for its status as a dividend aristocrat run into a reality: in a downtrend, the dividend is irrelevant if the price keeps collapsing. Revenue is falling, EBITDA is down, cash flow has been stagnant for years, and the multiples remain at growth levels the company no longer justifies.

The bunker narrative: fewer staff, fewer services, more café

According to internal sources, the company carried out a redundancy plan (ERE) in April 2025 that cut 40% of its workforce thanks to a production-organization software. Services such as doormen and waiters who served drinks were eliminated; bottled water was replaced with tap water. In Barcelona, the store on Passeig de Gràcia is being renovated to devote one floor to a café and another to jewelry and watches –the divisions that fall the least–, reducing space for handbags and leather goods, where sales are dropping the most.

The customer profile is also changing. It is estimated that 75% of buyers are Chinese tourists, and that the rest come from profiles the company prefers not to discuss. Sales commissions reach 0.2% for tourists and 0.3% for locals up to an item price of €2,800, reflecting the pressure on margins.

Does the current multiple make sense?

With revenue, EBITDA and cash flow flat or declining, and an environment of tariff wars and shrinking Asian consumption, the multiples remain at levels typical of a growth company. The market seems to have pushed the price to an extreme –as some analyses point out– that does not match the fundamentals.

Uncertainties over Chinese demand, competition from counterfeits and legal battles (such as the lawsuit by the Hermès heir) add further downward pressure. In the short term, the trend is bearish. In the long term, some argue that aspirational luxury faces a shrinking middle class and a tourism sector that is not recovering to pre-crisis levels. With these ingredients, the question is whether the current price already prices in the decline or whether there is still room to fall.