LVMH leads the charge as China’s luxury market shows first signs of life

BEIJING : China, a market that accounts for nearly one-third of the world’s $400 billion luxury industry, sent mixed signals to the global luxury sector in the third quarter of 2025. LVMH’s strong quarterly report sparked an $80 billion rally in luxury stocks last week, marking renewed investor confidence. However, the overall picture remains uneven, with companies like L’Oréal and Hermès reporting only modest gains and continued caution about China’s volatile economic landscape.

L’Oréal posted its first sales growth in China in two years, but results fell short of market expectations, leading to a 6% drop in its share price on Wednesday. “One quarter doesn’t make a trend,” said CEO Nicola Hieronymus, while noting that the company’s luxury brands such as Lancôme and Helena Rubinstein were key drivers of improvement. He also pointed to China’s upcoming Singles’ Day shopping festival on November 11 as a vital performance indicator for the year.

At Hermès, optimism was tempered. The company reported a “very slight improvement” in Chinese sales, but third-quarter results missed forecasts, sending its stock down over 4%. Executive Vice President of Finance Eric de Halleguette said that China’s October “Golden Holiday Week” brought dynamic spending, especially in watches and jewellery.

Leading the rebound, however, is Louis Vuitton’s parent company LVMH. The group saw its shares hit a two-decade high after reporting positive growth in Chinese sales, the first this year. LVMH’s optimism rippled across the sector, lifting shares of Kering, Richemont, Burberry, and Moncler. Chief Financial Officer Cecile Cabanis said the Chinese market is stabilizing with domestic growth of 5–10%, even as tourist spending remains subdued.