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Hermès has once again outperformed its rival LVMH, recording a notable growth rate of 7% in the first quarter, contrasting sharply with LVMH’s 3% contraction when adjusted for constant currency. This achievement comes amid fluctuating trade policies, including tariff threats from the Trump administration, yet Hermès remains optimistic about continuing robust growth throughout the year.
According to the latest revenue report released today, Hermès recorded consolidated revenues of €4.1 billion ($5.3 billion) for the first quarter of the year. In stark contrast, LVMH, helmed by billionaire Bernard Arnault, experienced stagnation across all divisions, leading to a significant drop in its share prices earlier this week. In contrast, Hermès saw impressive growth across nearly all major revenue-generating segments.
The luxury brand, renowned for its iconic Birkin and Kelly bags, was propelled by strong performance in its leather goods and saddlery division, which surged by 10%, alongside a 7.2% increase in ready-to-wear and accessories. Collectively, these sectors constituted almost 72% of Hermès’ total revenue for the first quarter, with increased demand for their new bag models, Médor and Mousqueton, acting as a significant growth catalyst.
Moreover, smaller categories such as jewelry and home products (classified under ‘other’) alongside silk and textiles also demonstrated growth, rising by 6.1% and 4.5%, respectively. Conversely, the more modest segments of watches and beauty products experienced declines, tumbling by 10% and 0.5%, making up only 5.8% of Hermès’ revenue in Q1.
Axel Dumas, the executive chairman of Hermès, remarked, “Despite a high comparison basis in the first quarter, the group achieved solid sales growth. In a complex geopolitical and economic context, the house is strengthening its fundamentals more than ever.”
Integral to those fundamentals are Hermès’ rigorous quality controls and commitment to creativity. Dumas emphasized that their vertical integration ensures the preservation of unique craftsmanship and is a strategy that they intend to build upon. Hermès embraces a philosophy of creative freedom, allowing artistic directors to explore themes connected to the brand’s rich history — this year’s theme being ‘Drawn to craft,’ which highlights the importance of design in their processes.
Hermès is Increasing Production Capacity
Operationally, Hermès is enhancing its craftsmanship by securing material supplies and fostering longstanding relations with suppliers. The vertical integration Dumas mentioned is reflected through strategic partnerships and acquisitions, which also bolster transparency within its supply chains and reinforce its material development strategies.
Regionally, Hermès noted that while its largest market, Asia Pacific (excluding Japan), was the slowest-growing segment at 1.2%, Japan emerged as a bright spot with growth exceeding 17%. The Americas, while facing challenges, still saw an increase of 11%. The company reported strong momentum in the United States leading up to Trump’s announcement of new tariffs on April 2.
Demonstrating its confidence in future growth, Hermès is ramping up production capabilities. This year, the company plans to open a new leather goods workshop in L’Isle-d’Espagnac, with additional facilities in Loupes and Charleville-Mézières set to launch in 2026 and 2027. These expansions are designed to enhance Hermès’ existing nine centers of expertise across France, further reinforcing the brand’s commitment to its heritage, particularly at a time when perceptions surrounding luxury goods manufacturing are evolving amid viral discussions targeting Chinese-made items on social media.
Looking forward to the remainder of 2025, Hermès reaffirmed its ambition for revenue growth at constant exchange rates, choosing not to disclose specific targets. In their statement, the company expressed a sense of confidence in navigating an increasingly uncertain economic and geopolitical landscape, bolstered by its artisan model, balanced distribution frameworks, innovative collections, and strong customer loyalty.
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