Hermès International Results [RMS] Outperform in Q4 as Asia Rebounds

PARIS – Hermès International extended its run in the fourth quarter of 2025, delivering near double-digit growth at constant exchange rates even as rivals such as Kering continue to struggle in a softer luxury market.

Sales in the three months to Dec. 30 reached 4.09 billion euros, up 9.8 percent at constant currency, staying on pace with the previous quarter.

“The Hermès model based on an exclusive and qualitative network, as well as strong vertical integration, has once again proven successful,” said Hermès executive chairman Axel Dumas. “This distinctive strategy has enabled the house to achieve robust revenue growth and strong performance.

“In an uncertain environment, Hermès is moving into 2026 with confidence, underpinned by its creativity and exceptional savoir-faire,” he added.

The French company handily outpaced analysts’ expectations, which had forecast growth at constant currency to come in at 8.4 percent.

Hermès’ position at the top of the ultra-luxury segment remains supported by brand equity, a loyal clientele and the company’s tight control over production and distribution with its vertically integrated model.

By contrast, sales at rivals LVMH Moët Hennessy Louis Vuitton were up just 1 percent at constant currency, while Kering fell 3 percent in constant currency, in the fourth quarter.

At Hermès, revenues rose across all geographic regions against a particularly demanding comparison base.

In Europe, sales rose 9.5 percent overall. France was up 7.8 percent, while the rest of Europe excluding France increased 10.6 percent at constant exchange rates.

Japan remained a bright spot, with sales up 11.2 percent, while the rest of Asia excluding Japan rose 8 percent, bringing total growth across Asia to 8.6 percent at constant currency.

The Americas delivered a 12.1 percent increase, and the Middle East vaulted 13.5 percent.

By category, Hermès’ core leather goods division once again drove momentum, with sales up 14.6 percent in the quarter. The category continues to lead the group’s performance, supported by sustained demand for its handbags such as the Constance and the Kelly, plus small leather goods.

Ready-to-wear posted a 7.1 percent increase, matched by silks, including the house’s signature scarves, also up 7.1 percent. Jewelry and home rose 12.9 percent, while watches recorded more modest growth of 3.2 percent amid a struggling market due to tariffs.

Beauty and fragrance remained a weak point. Sales in the category fell 14.6 percent at constant currency in the fourth quarter and were down 8 percent for the full year 2025.

The quarter also marked a creative transition within the house. Véronique Nichanian stepped down in October as men’s artistic director. She presented her final collection last month after 37 years at the house.

Hermès quickly appointed Grace Wales Bonner as her successor, who will present her first collection next year.

Looking at the full year 2025, Hermès reported consolidated revenue of 16 billion euros, up 9 percent at constant exchange rates. Currency fluctuations weighed heavily on the top line, with the group estimating a negative impact of 515 million euros on revenue, resulting in reported growth of 5.5 percent at current exchange rates year-over-year.

Recurring operating income rose 7 percent to 6.6 billion euros. Net profit reached 4.5 billion euros, up 5.5 percent, excluding the exceptional tax on large companies in France, in line with the pace of sales growth.

The group confirmed its medium-term revenue growth goals at constant exchange rates are on track.

“In a still uncertain economic and geopolitical context, the group has moved into 2026 with confidence, thanks to the highly integrated artisanal model, the balanced distribution network, the creativity of collections and the loyalty of clients,” the company said in a statement.