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While luxury demand slipped for LVMH as its first quarter organic revenue increased 3%, Sephora, perfume, and cosmetics sparkled for the French company.
Organic revenue for the perfumes and cosmetics category grew 7% YoY. The company noted that skincare, makeup, and Dior fragrances like Miss Dior and J’adore performed well in the quarter. Givenchy, Guerlain, and Kenzo perfumes were also a bright spot, as were new products from Benefit and Make Up For Ever and Fenty Beauty’s expansion into China.
LVMH’s Selective Retailing division had an 11% revenue spike year over year, driven by “remarkable growth” for Sephora, the company said in an earnings report, specifically in North America (where its store count grew), along with Europe and the Middle East. Sephora also debuted its “Clean at Sephora” and “Planet Aware at Sephora” seals indicating sustainable products globally in Q1.
- Sephora’s partnership with Kohl’s was also a bright spot. Kohl’s reported last month that sales for its store-in-store partnership with the beauty retailer surpassed $1.4 billion in 2023, and anticipated that it would exceed its goal of reaching $2 billion in sales by 2025. The retailer said 140 new Sephora at Kohl’s locations are slated to open by this summer.
The rosy beauty results for LVMH came after Ulta CEO Dave Kimbell earlier this month sent Ulta’s shares tumbling after he warned of beauty demand cooling, sharing at a JPMorgan Chase investor conference that the beauty retailer had seen “a slowdown in the total category.” While Ulta had expected sales moderation after “several years of strong growth,” it came “a bit earlier and a bit bigger than we thought,” Kimbell said. While LVMH reported that Sephora secured market share gains in Q1, Kimbell noted in Ulta’s Q4 call last month that its “market share of prestige beauty was more challenged” amid growing competition.