Hermès nine-month revenue up 2.9% as leather goods offsets regional softness

Revenue for the three months to September 30 reached €4.096 billion, equivalent to $4.61 billion. Over the first nine months of the year, group sales totalled €12.26 billion, a 2.9% increase on the prior year, with currency fluctuations stripping roughly €310 million from turnover during the period.

Leather goods and saddlery, the group's biggest division, grew 12.4% in the quarter to €1.912 billion. Hermès attributed the performance to demand for new models alongside its established iconic pieces, and said it continued to expand production capacity.

In the Americas, sales advanced 10.7%, supported by growth across countries and product lines and by new stores in Chicago, New York and Rio de Janeiro. Europe excluding France gained 8.6%, helped by Southern Europe and a London flagship that opened in June.

Japan rose 3.4% on momentum from loyal local customers, while Asia-Pacific excluding Japan grew 3.8%, with solid trading in Korea. Hermès described Greater China as stable over the nine months in what it called a more difficult context, and said Middle East sales fell 2.8% amid a complex geopolitical environment.

Despite the top-line gains, the shares dropped 8.1% to €1,247.50 in Paris on Thursday morning. Watches and ready-to-wear were among the weaker categories in the quarter.

Executive Chairman Axel Dumas said that "despite a complex environment, Hermès continues its profitable growth." The company reaffirmed its medium-term revenue growth ambition in the face of economic, geopolitical and monetary uncertainty, without providing a figure.