Dive Brief:
- Hermès consolidated revenue for the first quarter of 2024 was up 13% to 3.8 billion euros, or approximately $4.1 billion at current exchange rates, according to a Thursday release.
- Sales rose by double digits in every geographical area. In Asia, the company’s largest market by sales, Japan rose 11% year over year for the period, which the company credited “to the loyalty of its local customers” in the region. In Asia, excluding Japan, sales were up 9%, despite softer traffic in China following the Chinese New Year. In Europe, sales were also up 14%, while the Americas saw a 10% uptick. In the company’s other regions, sales rose 111% year over year, although those regions still collectively comprise the company’s smallest sector by revenue.
- Leather Goods and Saddlery, which includes bags and small leather goods, was up 16% for the period, due to sustained demand, per the release. Meanwhile, the ready-to-wear and accessories division was up 12% for the quarter, which the company credited to robust demand for fashion accessories and shoes. Other sectors, including jewelry and home furnishings, rose 20% following new jewelry and tableware launches.
Dive Insight:
The company’s revenue rise is due in part to consistent price increases.
In February, Hermès reported a year-over-year fiscal 2023 revenue increase of 16% to 13.4 billion euros. Meanwhile, Purseblog, which tracks the handbag industry, noted that prices for the company’s popular Kelly 25 Sellier Epsom bag have risen about 15% between 2019 and 2024. The brand’s preowned handbags continue to be top-sellers as well, according to handbag reseller Rebag.
In a statement, Axel Dumas, executive chairman of Hermès, said the company’s dedicated customer base was one of the reasons revenue was strong.
“The solid sales growth in the first quarter 2024 reflects the loyalty of our clients worldwide, the strength of the group’s artisanal model and the desirability of our creations in a more complex environment,” Dumas said. “Hermès pursues its strategy based on exceptional know-how, the finest materials and uncompromising quality.”
During the first quarter, the company also opened more doors, including its 34th store in China and a new store in Tokyo. In a Wednesday press release, Hermès also announced the opening of a new location in Princeton, New Jersey, which will be the company’s 41st U.S. store, per the release.
Looking ahead, the company said in its Q1 release that “despite the economic, geopolitical and monetary uncertainties around the world” it would confirm its “ambitious goal for revenue growth.”
“The group has moved into 2024 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. “Thanks to its unique business model, Hermès is pursuing its long-term development strategy.”
