Hermès continues to deliver. On Thursday, the French luxury house announced sales were up 9.8% year-on-year at constant exchange rates to €4.1 billion in the fourth quarter of 2025, ended December 31.
This is above consensus estimates of an 8.4% increase, and marks a very slight acceleration compared with the previous quarter (up 9.6%). “Steady as it goes,” wrote Bernstein luxury goods analyst Luca Solca in a note. “The quarter’s beat was driven by an acceleration across the Asia-Pacific region, excluding Japan, on a sequential basis, and in the Americas where strong momentum persisted.”
For the 2025 full year, Hermès sales were up 8.9% year-on-year to €16 billion. The positive performance sent stocks up 2% in early morning trading.
Hermès continues to outperform most of its luxury rivals. LVMH’s Q4 sales grew 1% to around €22.7 billion, despite its fashion and leather goods division declining 5%. Kering sales fell 3% year-on-year to €3.9 billion in the same three-month period. Richemont posted third-quarter sales growth of 11% to €6.4 billion.
Key growth categories for Hermès were leather goods and saddlery (up 14.6%); ready-to-wear and accessories (up 7.1%); and its “other” product lines, which include jewelry and homeware (up 12.9%). Watch sales rose 3.2% in the fourth quarter, while perfumes and beauty were down 14.6%.
Hermès said growth was driven by the Americas (up 12.1%), Europe (up 9.5%), Japan (up 11.2%), and “the other area”, which includes the Middle East (up 13.5%). Meanwhile, Asia-Pacific sales were up 8% year-on-year.
In China, Hermès has continued to scale during the luxury downturn, unlike many of its peers. “In China, we’re seeing growth: leather goods are performing very well, they’re playing their role as a pillar; while the two other business lines doing best are women’s ready-to-wear and jewelry,” executive chair Axel Dumas told analysts at the earnings conference, held at Paris’s Hermès flagship on Rue de Sèvres. Hermès currently has 32 boutiques across China. “[The store network] is intended to grow a bit, at our own pace,” he added. Elsewhere, store openings for the year will include London’s New Bond Street in June.
Asked to comment on the competition of local brands in the Chinese market, Dumas said: “I think the more success there is in our industry from different brands, the better. So I find it very interesting that China is developing brands in areas quite different from ours — in jewelry, Laopu is very different. It’s a different kind of know-how, quite ancestral craftsmanship, which is very interesting. Or Labubu, for example, I read a story in The New York Times asking if Labubus could have existed without the Birkin. It’s quite amusing — I don’t know the answer. So this Chinese dynamism, I find it rather positive than worrying.”
The executive said plans to launch Hermès couture “are progressing”. “We’ve hired ateliers. We’ll be ready when we’re ready. What I saw was amazing — I’m excited,” Dumas said.
Pressed to comment on the underperformance of the beauty business, Dumas noted that the challenge “lies in perfume itself, rather than in makeup and beauty”. “Very frankly, I think there are certain things we can do better, and we are working on them,” he said. “Unlike the rest of the group, [this business] depends a lot on [wholesale] distribution, and not everyone performs as well as Hermès. Sometimes, our partners prefer to buy less in order to manage their stock, so we are continuing quite strongly with our perfume development strategy, which is to grow to the scale necessary to create autonomous subsidiaries and to launch across the three categories: perfumes, makeup, and soon skincare.” Dumas didn’t provide a timeline for the launch of skincare or couture.
The company also announced plans to increase prices by an average of 5% to 6% in 2026, taking into account the elevated production costs, and offsetting the adverse currency impact. It previously raised prices by 6% to 7% in 2025. “Hermès is well-positioned in 2026,” Citi managing director Thomas Chauvet wrote in a note.