Dior rebound pulls LVMH's fashion and leather goods back into growth

LVMH reported second-quarter sales showing its fashion and leather goods division, the group's largest and most closely watched business, back in growth after nearly two years of decline. The rebound is understood to have been led by a recovery at Dior, alongside continued strength in the group's jewellery businesses, where sales rose sharply. Strong demand in the United States helped offset weaker spending in Europe and the Gulf, the latter dented by the regional conflict involving Iran.

The result matters beyond LVMH's own numbers. The fashion and leather goods division has been the bellwether for the wider luxury downturn that has weighed on the sector since 2024, and its return to growth, even a modest one, will be read by investors and rivals as a signal that the worst of the correction may be passing, at least for the strongest brands. Dior's recovery in particular will be watched closely given the house's importance to LVMH's margins and the scrutiny its creative and commercial direction has faced.

The figures also reinforce a theme now shaping how investors value luxury groups: jewellery is increasingly the swing factor. With fashion sales across the sector still uneven and Middle East spending disrupted, houses with strong high jewellery and hard luxury businesses, LVMH included, are better placed to cushion weakness elsewhere. Watch whether the US resilience holds through the second half, and whether Gulf demand recovers as regional tensions ease.

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