Luxury group Hermes witnessed a 10% revenue surge in Q4, driven by robust US consumer spending and a stabilizing market in China. Demand for signature handbags and leather goods continued to soar, overshadowing challenges in other product lines. The company's resilience, supported by its affluent clientele, positions it well for continued growth in 2026.
Hermes , the luxury goods group, demonstrated robust performance in the fourth quarter, driven primarily by strong consumer spending in the United States and a stabilizing market in China. The company's revenue surged by 10 percent during the three-month period, reaching €4.1 billion (US$4.87 billion; S$6.15 billion), a year-on-year increase at constant exchange rates. This performance surpassed the forecasts of analysts at Visible Alpha.
The key driver of this growth was the continued high demand for the French group's signature handbags, particularly the iconic Kelly and Birkin models. Sales for leather goods, Hermes' most significant division in terms of sales and profits, rose by 14.6 percent in the quarter, reflecting the unwavering appeal of its premium offerings among affluent consumers. Hermes has proven resilient in the face of broader economic uncertainties affecting the luxury sector, primarily owing to its ultra-wealthy clientele and the enduring desirability of its products. Other product lines, especially those with greater exposure to middle-class consumers, like perfumes and signature silk scarves, exhibited more subdued performance during the quarter. Beauty and perfume sales decreased significantly, down 14.6 percent compared to the same period the previous year, suggesting a sensitivity to shifts in consumer spending patterns within those segments. \The Americas region, heavily influenced by the U.S. market, experienced a 12 percent sales increase during the fourth quarter. This growth was fueled by continued strong spending by wealthy American consumers. Analysts anticipate that robust demand in the U.S. will contribute significantly to the luxury industry's recovery in 2026, offsetting ongoing challenges in the Chinese market. In the Asia-Pacific region, revenue grew by 8 percent, marking an acceleration compared to earlier in the year. This improvement hints at a stabilization of luxury demand within Greater China, following a period of sluggishness. The company's management had previously noted a “slight improvement” in China, and Hermes has sustained growth in China over the past two years, even amid a downturn in luxury demand for its competitors such as LVMH and Kering. \Overall, the fourth-quarter results helped lift Hermes's annual net profit by 5.5 percent, reaching €4.5 billion. According to James Grzinic at Jefferies, Hermes’ “delivery confirms an impressive resonance with luxury shoppers globally,” further suggesting that the company is experiencing success despite a fluctuating market. He added that the strong top-line delivery is supporting earnings stability in a time of foreign exchange headwinds. In a testament to its market dominance, Hermes briefly surpassed LVMH in market capitalization in April 2025, briefly becoming the largest luxury company by market value. Executive chair Axel Dumas expressed confidence in the company's future, stating that Hermes is moving into 2026 with confidence, relying on its creativity and exceptional savoir-faire
Hermes Luxury Goods Revenue Q4 Results China Market
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