With Rising Results, Hermès Resists in the First Half

While the luxury sector is going through a period of uncertainty and persistent tensions, Hermès is emerging as a beacon in the storm. The famous leather goods manufacturer's second-quarter revenue rose 9%, exceeding the first quarter's 7% increase (at constant exchange rates).

Between April and the end of June, the maker of the iconic Birkin and Kelly bags achieved sales of €3.91 billion, setting a new record for the period. These figures are in line with financial analysts' expectations, with the consensus forecast of 8.8% growth. The brand's ability to maintain positive momentum despite headwinds is a testament to its strong positioning and rigorous volume management, in line with a limited production strategy that reinforces desirability.

Regionally, the Middle East posted the strongest growth, with a jump of +20.4%. This result was driven by a dynamic economic environment, a young and affluent customer base, and the gradual opening of new commercial locations, particularly in Dubai and Riyadh. North America followed with a 12.3% increase, confirming sustained demand despite the slowdown in purchasing power in certain segments of the population.

Europe, meanwhile, is holding up well (+9.1%), supported by a clientele attached to the tradition of French luxury. However, France is an exception with more modest growth (+4.1%), impacted by a decline in international tourism, particularly from China, and a slight erosion of consumption in the domestic market.

In a regional context marked by complex geopolitics and an economic slowdown, Asia still managed to achieve growth of +5.2% (on a comparable basis). This figure, modest at first glance, takes on its full significance when compared with the more sluggish performances of competitors such as Kering and LVMH, which are facing a slowdown in demand in China.
Paradoxically, Japan emerged as an unexpected driver, with sales soaring 14.7%. Bucking the trend of its competitors, Hermès benefited from a solid local customer base that is less exposed to currency fluctuations and more attached to the values of craftsmanship and durability.

This ultra-premium clientele, less prone to economic trade-offs, continues to buy despite the economic climate. Hermès illustrates the success of a countercyclical model in the luxury sector. Where many groups are betting on rapid growth through volume and a proliferation of points of sale, the company is taking the opposite approach: controlled scarcity, artisanal excellence, and integrated production.

This model, often referred to as “slow luxury,” generates high margins, builds loyalty among a stable customer base, and avoids the saturation effects experienced by some of its rivals. The group also benefits from a balanced distribution of its revenues, without excessive dependence on any single market. This geographical and strategic diversification contributes significantly to its resilience.

Despite solid sales, net profit for the first half of the year declined slightly to €2.25 billion, compared with €2.37 billion a year earlier. This contraction is not related to an operational downturn, but to an exceptional measure imposed by the French government: a temporary tax on large corporations, intended to help reduce public debt. According to Hermès management, without this measure, net profit would have grown by 6%.

While several big names in the luxury sector are announcing restructuring plans, store closures or declines in profitability, Hermès is staying the course with a long-term strategy that has been patiently built and rarely deviated from. Despite macroeconomic uncertainties, Hermès remains one of the few groups to post solid organic growth without resorting to promotions, opportunistic collaborations or risky repositioning.