LVMH Moët Hennessy - Louis Vuitton, Société Européenne

LVMH said first-half 2026 revenue was EUR 38.6 billion, up 2% organically and down 3% reported, with Q2 organic growth at 3%. Operating margin was 22.5%, profit from recurring operations was EUR 8.7 billion, and net income was in line with last year. Gross margin improved 30 bps to 67.1%. Free cash flow reached EUR 4.1 billion, net debt declined by almost EUR 2 billion, and net debt-to-equity was 12%. For 2026, management expects Wines & Spirits to grow at constant currencies, though less than in H1, and expects full-year EBIT margin in that division to be closer to 2025 levels. Management also said the FX hit to margins in H2 is likely to remain about the same as in H1, and noted the interim dividend was fixed at EUR 5.50 per share, payable in December 2026.

Management’s tone was confident but disciplined, emphasizing resilience in a still-uncertain macro environment. The CEO and CFO highlighted improving trends across regions, the strength of iconic products, and the payoff from creative renewal, selective distribution, and store investments. They also stressed that the group will continue investing selectively while staying tightly focused on cost discipline, brand desirability, and operational efficiency.

The CFO emphasized that currency was the main drag, with nearly EUR 700 million of negative FX impact on operating income in H1 and a strong euro-based revenue translation headwind. She highlighted gross margin improvement to 67.1%, a 2% decline in marketing and selling expenses, flat G&A, and strong free cash flow of EUR 4.1 billion. She also noted net debt fell by almost EUR 2 billion, the debt-to-equity ratio improved to 12%, and the interim dividend was set at EUR 5.50 per share. On outlook, she said Wines & Spirits margin should be closer to 2025 levels in full year due to cost phasing and FX lag effects, and that H2 margin FX pressure should remain roughly similar to H1.

Analysts focused on Dior and Vuitton performance, Asia and China demand, the impact of FX, and whether the improvement in Wines & Spirits and Jewelry is sustainable. Management said Dior and Vuitton were both positive in Q2, with Dior slightly above Vuitton, but declined to quantify the benefit of resolving supply constraints. On China, management said demand was flat overall and increasingly clustered around shopping events, while Asia’s Q2 slowdown reflected Chinese client spending shifting more to Europe and Japan rather than a collapse in demand. They also said Tiffany’s store transformation is still weighing on margins, but should gradually provide leverage as growth and icon performance improve, and that Wines & Spirits should continue to grow in 2026, though more moderately than H1.