The contrast with the sector's bellwether was stark. LVMH reported last week a 5 percent organic sales decline in its Fashion and Leather Goods division; Hermès reported growth of 4.3 percent at constant exchange rates (5.5 percent reported) to €4.1 billion for the third quarter . The figure came in slightly below market consensus — yet management confirmed its full-year guidance "despite the deterioration in the macroeconomic and geopolitical environment," citing strong momentum in Europe, the Americas and Japan.
The resilience is structural. Hermès closed 2025 with revenue above €16 billion for the first time, up 9 percent at constant exchange rates, a 41 percent operating margin and net profit of €4.5 billion — numbers achieved while the broader luxury sector absorbed a two-year China slowdown and promotional pressure elsewhere. The house runs a vertically integrated artisanal model with an exclusive retail network (294 stores in 45 countries), disciplines distribution rather than chasing volume, and holds pricing power competitors have largely conceded . ## The métiers: leather carries, ready-to-wear sags
The third quarter confirmed the pattern of the year — and of the decade. Leather Goods and Saddlery — the métier built around the Birkin and Kelly — grew 10.8 percent at constant exchange rates (up 12.4 percent reported) to €1.912 billion, extending its run as the group's engine. Perfume and Beauty jumped 7.5 percent to €128 million, and the "Other products" division (John Lobb, Saint Louis) rose 10.5 percent to €92 million. The softer spots are equally instructive. Ready-to-wear and Accessories declined 2 percent to €1.141 billion; the "Other Hermès sectors" division (jewellery and homeware) contracted 1.1 percent to €486 million; and Watchmaking fell 6 percent to €125 million. Silk and textiles edged up 1.4 percent to €214 million .
Leather's share of the mix keeps expanding: it stood at 44 percent of 2025 sales (€7.07 billion, up 13 percent), versus roughly 55 percent a decade earlier — though executives note that much of the "diversification" reflects clients purchasing across categories to build the relationships that unlock access to the most coveted bags . ## The geography: Americas and Japan offset a flat China Regional divergence defined the quarter. Asia-Pacific excluding Japan rose 3.8 percent at current rates but was flat at constant rates; Japan surged 9.6 percent at constant rates (up 3.4 percent reported). The Americas were the standout, up 10.7 percent, with what the group described as "strong growth across all countries and businesses." Europe excluding France grew 8.6 percent, and France rose 3.6 percent .
China remains the watch item. At Thursday's press briefing, CFO Eric du Halgouët described a challenging backdrop: a property market "still in decline," "a level of confidence that remains low and is leading to a high savings rate," and new tax legislation for Chinese taxpayers. His verdict was measured rather than alarmed: "We had mentioned at the end of June that Greater China was showing slight growth. Admittedly, by the end of September, business had dipped slightly in the third quarter, but it remains stable, which is nonetheless a significant achievement in this very difficult market. We are confident about the long-term outlook in China; we have a very high-quality network — there are only 31 stores — so we are continuing to invest" .
Over nine months, the group's revenue grew 5.5 percent at constant rates (2.9 percent reported) to €12.26 billion: Europe generated more than €3 billion (up 9 percent), Asia €6.382 billion (up 3.3 percent), the Americas €2.376 billion (up 13.1 percent), and the "Other" region — which includes the Middle East, where conflict has weighed since February — declined 4.3 percent to €479 million . ## What the leaders said Axel Dumas, executive chairman, used the results to showcase what's next creatively: "It is with great enthusiasm that we are preparing for a new year rich in creativity, with the first menswear ready-to-wear collection designed by Grace Wales Bonner and the launch of couture by Nadège Vanhée next January" .
The two milestones matter. Wales Bonner — appointed in October 2025 as the successor to Véronique Nichanian after her 37-year tenure, and the first Black woman to lead design at a major European luxury house — will debut her first menswear collection in January 2027 . Vanhée, the house's women's artistic director since 2014, will lead the launch of couture next January . On the industrial side, Hermès is gearing up to expand leather goods capacity with new workshops opening over the coming years: Charleville-Mézières (Ardennes) by 2027, Colombelles (Calvados) by 2028, and Les Andelys (Eure) by 2030 . ## What analysts make of it
The caution came through in the sell-side notes. "Hermès continues to suffer from a generally difficult trading environment," wrote Bernstein analysts — a reminder that even the industry's most resilient model cannot fully decouple from the sector's downdraft. The medium-term signal from the company itself, however, was unambiguous: "despite global economic, geopolitical and monetary uncertainties," Hermès confirmed "an ambitious target for revenue growth at constant exchange rates" . ## What to watch
1. **Q4 comp:** the fourth quarter of 2025 grew 10 percent at constant rates — a demanding comparison. Holding guidance will require the Americas and Japan momentum to persist . 2. **The Middle East:** the "Other" region's 4.3 percent nine-month decline is the group's only geographic soft spot; conflict duration will determine whether it deepens. 3. **January 2027:** the Wales Bonner debut and the Vanhée couture launch are the most-watched creative events on the Paris calendar — and the first real test of how the new creative architecture lands commercially. ***
