The latest results suggest that luxury is returning to growth. They also reveal a more selective market, rewarding houses that can make their value, identity and relationship with clients unmistakably clear.
The latest luxury results arrived within the space of a few days. LVMH reported accelerating growth in the second quarter. Kering returned to comparable growth while sharply reducing its debt. Hermès maintained recurring operating profitability of 41%. Richemont’s Jewellery Maisons continued to outperform.
Read together, these announcements describe a more consequential shift than resilience alone.
Luxury is beginning to recover, but the recovery is neither uniform nor a return to the conditions that powered the previous decade. Categories are moving at different speeds. Regional performances remain uneven. Financial discipline is improving faster than desirability at some houses, while others demonstrate the commercial strength of consistency.
Bain and Altagamma expect the personal luxury goods market to grow by 2% to 4% in 2026, reaching between €365 billion and €373 billion. Yet they also describe sharp regional divergence and a consumer changing the way luxury is evaluated and discovered. Half of luxury shoppers now consult the second-hand market before purchasing new, and half already use artificial intelligence during their purchase journey.
The second half of 2026 should therefore be understood as a period of reconstruction rather than a simple rebound. The issue is whether the sector can produce a better quality of growth: one that strengthens perceived value, restores creative authority, adapts more precisely to local clients and uses technology without weakening the qualities that distinguish a luxury house.
Four tests will help reveal which brands are moving in that direction.
TEST ONE: CAN RESTRUCTURING BECOME DESIRABILITY?
Kering provides the clearest example of the distinction between repairing a business and rebuilding a brand.
The group generated first-half revenue of €7.2 billion, up 1% on a comparable basis, with second-quarter growth of 2%. Its recurring operating margin reached 12.8%, while net debt fell from €8 billion at the end of 2025 to €3.3 billion at the end of June. Kering also completed 84 net store closures during the first half, following 75 in 2025.
The reduction in debt is substantial, although it should be read in context. Kering received €4 billion from the completion of the Kering Beauté sale to L’Oréal, while free cash flow included real-estate proceeds and €300 million linked to the Gucci Beauty agreement. The balance sheet has been given greater room to breathe; the harder work now lies at house level.
There are encouraging indications. Gucci’s comparable decline narrowed from 8% in the first quarter to 2% in the second, while sales from directly operated stores improved by seven percentage points sequentially. Saint Laurent returned to growth over the semester, Bottega Veneta continued to outperform and Kering Jewellery recorded comparable growth of 20% in the first half.
These results create better conditions for renewal, but they do not complete it. Store closures can restore distribution discipline and cost control can protect investment capacity. Neither gives a client a reason to fall in love with a collection.
For Kering, and for every group navigating a similar transition, the next test is creative and commercial. Can a more disciplined structure produce clearer house identities? Will new products remain desirable after the initial launch cycle? Can improved retail execution deepen engagement among established clients and those who have become less convinced by the brand?
The second half should reveal whether restructuring is a defensive correction or the foundation for renewed creative confidence.
TEST TWO: CAN VALUE BECOME VISIBLE AGAIN?
The strongest performances of the first half are concentrated in categories and houses where value remains comparatively easy to perceive.
At LVMH, Watches & Jewellery delivered organic growth of 9% during the first half and 11% in the second quarter, supported by Tiffany and Bvlgari. Fashion & Leather Goods, still down 1% organically over the semester, returned to 1% growth in the second quarter. Selective Retailing grew by 5%, with Sephora maintaining its momentum.
Richemont’s results make the category contrast more pronounced. During the financial year ending in March, its Jewellery Maisons grew by 14% at constant exchange rates and generated an operating margin of 30.5%. Specialist Watchmakers grew by 1%, with an operating margin of 3.4%. The following quarter widened the momentum: Jewellery Maisons rose by 24%, compared with 8% for specialist watchmakers and 9% for the group’s other activities.
Hermès offers a different, equally instructive model. First-half revenue reached €8.2 billion, up 6% at constant exchange rates, while recurring operating profitability remained at 41%. Leather Goods and Saddlery grew by 10%. The house also opened its twenty-fifth leather workshop and is continuing to expand capacity through the training and integration of artisans.
Jewellery and Hermès leather goods do not succeed for identical reasons. They nevertheless share an important characteristic: the elements supporting value are unusually legible.
Material, technique, scarcity, iconography, time and transmission can be understood through the object itself. The client may not know every manufacturing detail, but the product gives the house credible material from which to explain why it matters and why it should endure.
Richemont’s jewellery growth is supported by powerful historic collections that are continually reinterpreted. Hermès develops its capacities without separating growth from the time required to transmit its skills. Its model progresses through continuity rather than repetition.
For the wider sector, the priority is to make value perceptible again across more categories: what an object required to create, what makes its design specific, how it advances the house’s language and why it deserves a lasting place in a client’s life.
As clients compare new products with previous collections, competitors and the second-hand market, communication alone cannot sustain value. The product, service and evidence behind it must carry more of the argument.
TEST THREE: CAN GLOBAL SCALE BECOME LOCALLY INTELLIGENT?
The geographical data gives little support to the idea of a single global luxury consumer returning at a uniform pace.
The Americas provide one of the clearest sources of momentum. Hermès grew by 15% in the region during the first half. Richemont’s first-quarter sales rose by 27%, supported by local demand. Kering identified North America as a key contributor to the improvement at Gucci and Saint Laurent, while LVMH reported accelerating growth in the United States.
Asia requires a more nuanced reading. Richemont grew by 21% in Asia-Pacific during its latest quarter. Hermès recorded growth of 2% in Asia excluding Japan, with particularly strong performance in Korea and continued progress in Greater China. Kering reported improving trends in Asia-Pacific at Gucci, although mainland China remained challenging. Japan continued to perform strongly for both Hermès and Richemont, supported by local clients.
Europe and the Middle East present different constraints. Hermès saw solid growth in Europe outside France and an acceleration in France as tourism recovered, but its Middle Eastern business remained slightly down. Kering estimated that the regional conflict reduced its second-quarter group growth by one percentage point. Bain similarly identifies Europe and the Middle East as drags on the personal luxury goods market in 2026.
These variations challenge the model in which a global campaign, product launch or retail concept is distributed with limited adaptation across markets.
Local intelligence should not mean replacing a house’s identity with regional trends. The opportunity is to understand how exclusivity, service, culture and product relevance are interpreted differently without making the maison unrecognisable from one city to another.
The new Hermès Maison on New Bond Street spans six buildings and more than 2,000 square metres. The house has also opened or renewed locations across Asia, treating each city as a context rather than a neutral address. LVMH cited the performance of Louis Vuitton’s new Beijing and Seoul stores among the contributors to its second-quarter acceleration.
A store should do more than reproduce an international design concept in a new location. It can reflect local rituals, client behaviours, cultural institutions and expectations of service, while making the house’s own world more vivid.
Global scale remains an advantage. Uniform global expression increasingly does not.
TEST FOUR: CAN AI DEEPEN DISCOVERY AND SERVICE?
Artificial intelligence is already changing how luxury is discovered, whether houses are prepared for it or not.
A Bain and Comité Colbert study found that 64% of Chinese respondents and 54% of American respondents had used AI during their most recent luxury purchase, compared with 27% in France. Among very heavy spenders, the figure rose to 82%. Almost half of clients who ultimately purchased in a store had used AI somewhere in the journey, mainly for discovery, comparison and research.
This creates an unusual imbalance. Luxury houses remain cautious about introducing AI into client-facing interactions, while their clients are already using generalist tools to decide which brands and products deserve consideration.
Approximately 70% of the luxury-related generative searches analysed by Bain did not mention a brand name. The consumer was asking the system to suggest one. Yet only 10% of the surveyed houses and groups considered themselves strong in generative-search visibility, and around 60% had not achieved significant impact from any AI deployment.
The immediate strategic issue is control over how a house is represented. Products, expertise, history and points of distinction need to be sufficiently structured and credible to surface accurately when an AI system answers an unbranded question.
There is also a deeper client-experience opportunity. AI can help a sales adviser prepare for an appointment, retrieve product knowledge, understand previous interactions or continue a conversation across channels. It can improve recognition without pretending to replace it.
Luxury retail has often spoken about personalisation while delivering a relatively standardised interaction. Better use of data and technology could make the human exchange more informed, attentive and continuous. The adviser would remain responsible for judgement, tact and emotional intelligence.
The danger lies in using the same tools and optimisation principles to produce the same recommendations, content and journeys across every house. AI can widen access to expertise, but it can also accelerate sameness. Its value in luxury will depend on the quality of the identity and knowledge placed behind it.
WHAT H2 PERFORMANCE SHOULD REALLY BE MEASURED AGAINST
The results published this summer offer reasons for cautious confidence: the United States remains dynamic, China is showing selective signs of recovery and jewellery continues to demonstrate exceptional strength.
Yet the most useful measures for the next six months will sit behind the headline figures.
At Kering, the question is whether financial discipline and organisational change produce stronger products, sharper identities and more convincing client engagement. At LVMH, it will be whether creative renewal and investment in exceptional retail experiences can extend the second-quarter acceleration. Hermès will continue to test how far a house can develop while protecting the coherence of an artisanal model. Richemont’s performance will show whether jewellery can sustain its momentum as comparisons become more demanding and material costs remain elevated.
Across the sector, leaders should watch whether value becomes easier to understand, whether regional strategies become more culturally precise and whether technology strengthens the quality of discovery and service.
A recovery can quickly become an invitation to resume familiar habits: more openings, more launches and another cycle of expansion. That would overlook what the slowdown has exposed.
Consumers have become more selective because they have more ways to compare, more sources of information and a clearer view of the alternatives. Winning them back requires more than renewed spending confidence. It requires better reasons to choose.
The defining luxury story of H2 2026 will not be whether the market grows by two, four or six per cent. It will be which houses use the recovery to rebuild those reasons.
Marine Moureaux-Gall / MAENA Agency
Featured image credit: AI-generated editorial visual, art-directed by MAENA Agency.
