This Week: What Bernard Arnault Can and Can’t Tell Us About the State of Luxury
Bernard Arnault doesn’t often speak publicly. But when he does, what he says can move markets. In 2024, for instance, luxury stocks soared after he said he was “very confident” about the year ahead. Of course, LVMH’s fashion and leather goods revenue declined that year for the first time since the pandemic, and anyone who bought the company’s stock after he spoke would have lost 20 percent on their investment by year’s end. Nobody can predict the future, not even the CEO of the world’s largest luxury conglomerate.Even so, it’s worth tuning in for Arnault’s annual press conference on Tuesday after the company reports its fourth-quarter and full-year result. Analysts are predicting another revenue decline. The question is what 2026 has in store. This time around, Arnault’s outlook on the luxury market comes just as the industry’s big reset is kicking into high gear. His outlook will also be informed by the initial reception to Jonathan Anderson’s first Dior collection, which hit stores early in the new year and is meant to reverse a troubling decline at the group’s second-largest brand.LVMH’s global business also provides a window into some of the macroeconomic questions that will define 2026 for the entire fashion industry: Are Chinese consumers feeling optimistic enough to start spending the savings they’ve accumulated since the pandemic? Will wealthy Americans continue to shop, or will they succumb to the pessimism reflected in near record-low consumer sentiment? Were president Donald Trump’s on-again, off-again tariff threats over Greenland a sign that 2026 will be even more turbulent than last year?There are also some lingering questions around smaller LVMH businesses that the company or Arnault himself could address. The company’s watch division is struggling with flat revenue and shrinking profits; Tag Heuer’s CEO recently exited with no successor named. LVMH just sold its DFS travel retail business in Hong Kong and Macau.Lastly, there is the delicate question of succession planning. Last year, LVMH shareholders passed a resolution allowing Arnault to remain in his role until age 85, or the year 2034. Still, investors are eager for details about what will come after Arnault retires, whenever that may be. He has been gradually elevating his children into key roles across the company, and the annual results offer another opportunity to signal that the company has its future mapped out.The Week Ahead wants to hear from you! Send tips, suggestions, complaints and compliments to brian.baskin@businessoffashion.com.Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.
