Consumers are generously purchasing Cartier jewelry, helping Richemont Group's sales to unexpectedly achieve double-digit growth during the holiday shopping season, indicating that demand for Luxury Goods may be recovering.
Richemont Group announced on Thursday that sales soared by 10% in the fourth quarter based on fixed Exchange Rates. Analysts had previously expected an increase of less than 1%. The Americas and Europe markets were the main engines of growth, offsetting the disappointing sales from watches with the strong demand for expensive jewelry.
"We believe this performance is exceptionally strong," wrote Piral Dadhania, an Analyst at Canaccord Capital Markets, in a report.
Although Richemont Group's jewelry business is large enough to mitigate the impact of demand fluctuations in Other fashion categories to some extent, its performance has still sparked optimism in the Luxury Goods Sector. Richemont Group's stock price surged by as much as 18% in early trading, also lifting other Luxury Goods stocks. LVMH rose by 8.6% in Paris, and Hermès increased by 6%. Goldman Sachs' European Luxury Goods Index recorded its largest increase since March 2022.
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