PARIS – Hermès International reported third-quarter revenue growth of 4.3 percent at constant currency to 4.1 billion euros, amid strong demand for leather goods and continued momentum in the Americas and Europe, which offset stagnation in China.
That fell short of analysts’ expectations, which had consensus on growth in the third quarter hitting 5.2 percent.
The French luxury group’s performance marked a slowdown from the 9.6 percent growth recorded in the same period last year, underscoring the increasingly challenging environment facing luxury brands as demand across Asia remains subdued.
“Hermès continues to suffer a difficult trading environment overall,” said Bernstein analyst Luca Solca.
“Despite a complex environment, Hermès continues its profitable growth and maintains its course. Convinced of the strength and relevance of our artisanal model, we see our vision as firmly rooted in the long term, and we look to the future with confidence,” chief executive officer Axel Dumas said in a statement.
He added that the company is looking forward – perhaps hoping for a boost in sales – to the first men’s ready-to-wear collection by Grace Wales Bonner, as well as the introduction of haute couture by Nadège Vanhée, both due in January 2027.
By region, Europe delivered the strongest performance, with sales rising 7.2 percent overall at constant currency. Sales were up in its home country of France, too, by 3.6 percent, while sales across the continent excluding France rose 9.5 percent.
Japan was a powerhouse once again, with sales up 9.6 percent, while the Americas were up 8.8 percent in the three months to the end of September.
But outside of Japan, sales were flat with zero growth or decline, bringing growth across the wider Asian region to 1.9 percent. The Middle East declined 4.5 percent, reflecting continued geopolitical and economic uncertainty across the region.
Leather goods remained the group’s main growth category for the Kelly and Birkin bag maker, with sales increasing 10.8 percent at constant currency, supported by demand for both new designs and established products.
Elsewhere, perfume and beauty sales rose 7.5 percent at constant currency, while sales at its subsidiaries including John Lobb shoes, Saint-Louis glassware and Puiforcat silverware, grew 10.5 percent. Sales of the brand’s silk scarves were up 1.4 percent.
But ready-to-wear and accessories sales took a small hit, down 2 percent in the third quarter, while jewelry and home products fell 1.1 percent. Watches remained the weakest category, continuing their fall, dropping 6 percent in the third quarter.