Luxury brands like Louis Vuitton have been hit hard by a decrease in consumer spending on luxury goods in China. The company’s CFO, Jean-Jacques Guiony, informed investors that this drop is linked to the recent changes in China’s stock market during July and August. He mentioned that significant asset depreciation, such as the one in China, naturally impacts their business.
The company reported slow growth in its main fashion division sales but noted a stronger performance in its wine and spirits segment. China’s ongoing economic slowdown and continued government anti-corruption campaign have reduced luxury spending in recent years. Although LVMH, the world’s largest luxury company, initially withstood these pressures, it is now feeling the effects of China’s market challenges.