Hermes Sales Growth Slows Amid Uncertain Recovery Path for Luxury Sector — Update

By Andrea Figueras

Birkin bag maker Hermes reported a slowdown in sales growth for the first quarter as the war in Iran clouds the sector's rebound.

The French company booked revenue of 4.07 billion euros ($4.80 billion) for the first three months of the year, 5.6% higher than in the same period a year earlier excluding currency movements. The rise in quarterly sales showed a downward trend compared with the previous three months, when Hermes booked a 9.8% increase.

At current exchange rates, first-quarter sales declined on year due to a significant negative impact of currency fluctuations of 290 million euros.

The overall result fell short of analysts' forecast of 4.16 billion euros, according to a Visible Alpha poll of estimates.

Luxury brands have been struggling for years with shrinking demand for high-end goods, as well as tough market conditions including trade disputes and geopolitical instability. The industry had hoped for a recovery this year, driven by better results in crucial markets like the U.S. and China, but the war in Iran has cast a shadow over those expectations.

Rival LVMH, the owner of Louis Vuitton and Dior that is considered a pacesetter for the luxury industry, earlier this week posted weak first-quarter sales, citing a disrupted geopolitical and economic environment stemming from the conflict. Kering, the parent company of Gucci, noted that the broader consideration going forward relates to potential impacts on global tourism trends and the macroeconomic backdrop.

Hermes said that despite the slowdown in tourist flows linked to the war in the Middle East, which hit the company's performance in its home market, sales in the group's stores increased by 7%. Wholesale activity was significantly affected by lower sales to concession stores, particularly in the Middle East and in airports.

In the region directly affected by the war, Hermes saw a significant impact from March onward, notably in the United Arab Emirates, as well as in Kuwait, Qatar and Bahrain.

"In a still uncertain economic and geopolitical context, the group has moved into 2026 with confidence," the company said, and reiterated its medium-term guidance of sales growth at constant exchange rates.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

April 15, 2026 03:02 ET (07:02 GMT)