Daily Analysis – 2026-01-28
Top Companies
LVMHFerragamoLoro PianaBreguet
Top Sectors
Luxury FashionLuxury Watches
Top Countries
FranceItalyThailand
Summary
LVMH’s 2025 results show the group stabilizing top-line performance through selective distribution strength and disciplined financial management, even as Fashion & Leather Goods and Wines & Spirits remain under pressure from the luxury slowdown and trade tensions. Ferragamo’s sub-€1 billion year underscores brand-level vulnerability in Asia and wholesale, prompting a sharper focus on footwear/leather goods efficiency. Separately, LVMH’s €1 billion move to lift Loro Piana to 94% signals renewed conviction in ultra-premium, supply-backed maisons, while Breguet’s Thailand debut highlights continued retail expansion bets in Southeast Asia for high-end watchmakers.
Key News for Today
LVMH limited 2025 organic sales decline to 1% while strengthening cash flow and cutting net debt, but saw continued pressure in Fashion & Leather Goods and Wines & Spirits.
Why it matters: The results show how LVMH is offsetting category weakness with selective distribution and balance-sheet discipline, shaping competitive resilience in a slowing luxury cycle.
Impact: Near-term profit pressure persists (operating income down 9%, net profit down 13%), but stronger free cash flow and lower net debt improve flexibility for brand investment and cost control in 2026.
What to follow: Watch 2026 guidance on cost control, Asia ex-Japan growth sustainability, and whether Fashion & Leather Goods returns to positive organic growth.
Ferragamo fell 5.7% to €976m in 2025, with Asia-Pacific down double digits and wholesale sharply weaker, prompting a renewed push around footwear and leather goods efficiency.
Why it matters: The mix of Asia demand softness and wholesale contraction highlights structural exposure in Ferragamo’s channel and regional footprint as the sector normalizes post-boom.
Impact: Revenue pressure and category weakness in footwear (nearly half of sales) risk margin compression unless the collection and merchandising reset drives improved sell-through and DTC productivity.
What to follow: Track Asia recovery, wholesale normalization, and footwear/leather goods performance as leading indicators of turnaround traction.
LVMH exercised a call option to buy an extra 9% of Loro Piana for €1bn, lifting ownership to 94% and valuing the maison at €11bn.
Why it matters: Raising control of a high-end, supply-anchored brand reinforces LVMH’s strategy of concentrating ownership in proven ‘quiet luxury’ assets with long-term pricing power.
Impact: The €1bn deployment is modest at group scale but increases capture of future earnings and strategic control over a fast-appreciating brand (implied value quadrupling since 2013).
What to follow: Monitor any further buyout steps toward full ownership, brand investment acceleration, and whether Loro Piana meaningfully expands distribution or category breadth (e.g., Interiors).
Breguet opened its first Thailand boutique at IconSiam, using experiential design and showcasing high-complication pieces to deepen Southeast Asia presence.
Why it matters: A first-store entry signals a targeted retail expansion approach for high watchmaking, aiming to capture local and tourist demand in Bangkok’s prime luxury retail hub.
Impact: Single-boutique economics are unlikely to move group-level revenue materially, but can lift brand visibility and direct retail margins in a growing regional market.
What to follow: Watch store productivity, clienteling traction, and whether Swatch Group expands mono-brand distribution further across Southeast Asia.