In a market where many of its peers are struggling to hold their footing, Hermès is riding high. The French house reported a 9 percent increase in second-quarter sales, reaching $4.4 billion (€3.9 billion), outpacing analyst expectations and its rival global luxury brands. At the heart of this success is the enduring appeal of the Birkin and Kelly bags, coveted status symbols that continue to draw wealthy collectors. Hermès’ leather goods division saw 12 percent organic growth in the first half of the year, bolstered by demand that still far exceeds supply. Operating income rose 6 percent to $3.7 billion (€3.3 billion), further cementing Hermès’ position in the luxury world. Earlier this year, it eclipsed LVMH to become the most valuable luxury group by market capitalization for the first time. Still, the maison faces challenges in other areas. Shares dipped 4 percent following the announcement, reflecting broader investor caution amid a decline in entry-level luxury. Sales in Hermès’ silk and beauty departments fell by 4 percent, and executive chairman Axel Dumas noted a decline in aspirational shoppers and first-time clients. Bernstein analyst Luca Solca noted that weaker performance in some of Hermès’ smaller divisions signals continued pressure in the luxury market, according to the Financial Times. In the U.S., where Hermès raised prices this spring to offset rising tariffs, sales still jumped more than 12 percent. Despite new 15 percent levies announced under a recent EU-US trade pact, Dumas indicated no further hikes were planned—at least for now. Asia-Pacific sales rose moderately by 3 percent, despite a broader decline in luxury spending in China. Dumas noted that while China’s market remains sluggish since the pandemic, he sees no major shifts and remains confident in its long-term luxury potential, according to the Financial Times. While much of the upscale market struggles with shifting demand, Hermès has so far held steady—buoyed by its tightly controlled supply, loyal high-end clientele, and iconic pieces. Despite changing consumer habits, demand for the Birkin shows little sign of slowing.

Hermès Bucks the Luxury Downturn With 9% Sales Growth in Q2

Hermès reported a 9% increase in second-quarter sales, reaching $4.4 billion, outperforming peers despite challenges in silk and beauty departments. The luxury brand attributes its success to high demand for iconic Birkin and Kelly bags, while maintaining confidence in long-term market potential.