French luxury group Herm\u00e8s will raise its U.S. prices from the start of May in order to offset the impact of President Donald Trump\u2019s tariffs, the company\u2019s finance chief said Thursday.<\/p>\n
The company \u2014 which earlier this week overtook rival LVMH as the world\u2019s biggest luxury firm by market capitalization \u2014 is best-known for its Birkin and Kelly handbags, along with colorful scarves retailing for hundreds of dollars. Other products include jewelry, watches, shoes, perfume and make-up.<\/p>\n
\u201cThe price increase that we\u2019re going to implement will be just for the U.S. since it\u2019s aimed at offsetting the tariffs that only apply to the American market, so there won\u2019t be price increases in the other regions,\u201d Eric du Halgou\u00ebt, Herm\u00e8s\u2019 executive vice president for finance, said during an analyst call that followed the firm\u2019s first-quarter results release on Thursday.<\/p>\n
Herm\u00e8s said prices will rise from May 1 and aim to \u201cfully offset\u201d the impact of the universal 10% tariff imposed by the White House in early April, rather than the 20% duties the European Union may face unless it can negotiate a new deal during Trump\u2019s 90-day reprieve.<\/p>\n
U.S. consumers are expected to contend with higher prices on a host of items, ranging from electronics and clothes to cars and houses, as the impact of tariffs bites.<\/p>\n
In its first-quarter results, Herm\u00e8s reported 11% sales growth in the Americas, which accounted for nearly 17% of its sales revenue in the first three months of the year.<\/p>\n
First-quarter revenue growth came in at 7% on a constant currency basis overall, just shy of consensus expectations of an 8% to 9% increase, Deutsche Bank analysts said in a note. It also represented a slowdown from 17.6% growth in the fourth quarter of 2024.<\/p>\n
The Deutsche Bank analysts said that the results were nonetheless \u201crobust,\u201d with weakness driven by watches and perfume sales, while Citi described them as \u201ca respectable outcome.\u201d<\/p>\n
Herm\u00e8s shares dipped 1.3% in Thursday morning deals, taking its value to 244.5 billion euros ($278.2 billion) \u2014 just shy of LVMH\u2019s 245.7 billion euros \u2014 according to a CNBC calculation of LSEG data.<\/p>\n
LVMH, controlled by France\u2019s billionaire Arnault family, unsuccesfully tried to acquire Herm\u00e8s a decade ago. Despite drawing level in market cap, Herm\u00e8s\u2019 annual revenue is less than a fifth that of sprawling LVMH, which owns luxury brands Louis Vuitton and Dior, alcohol business Mo\u00ebt Hennessy, U.S. jeweler Tiffany and beauty chain Sephora.<\/p>\n
LVMH on Tuesday reported an unexpected decline in first quarter sales, flagging a fall in its dominant fashion and leather goods division.<\/p>\n
Analysts have predicted the luxury sector will be less impacted by tariffs than other retailers due to their ability to pass on increased import costs to a high-spending clientele. However, they would encounter major headwinds from a broad pullback in consumer spending as a result of weaker global economic growth or recessionary fears.<\/p>\n<\/p>\n
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French luxury group Herm\u00e8s will raise its U.S. prices from the start of May in order to offset the impact of President Donald Trump\u2019s tariffs, the company\u2019s finance chief said Thursday. The company \u2014 which earlier this week overtook rival LVMH as the world\u2019s biggest luxury firm by market capitalization \u2014 is best-known for its Birkin and Kelly handbags,…<\/p>\n","protected":false},"author":1,"featured_media":107,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-106","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts\/106","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/comments?post=106"}],"version-history":[{"count":0,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts\/106\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/media\/107"}],"wp:attachment":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/media?parent=106"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/categories?post=106"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/tags?post=106"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}