Hermès sales surged as wealthy shoppers snapped up its pricey handbags over the holiday season, underlining the brand’s resilience compared with luxury peers.
Sales jumped almost 18% in the fourth quarter at constant exchange rates, Hermès International SCA said in a statement Friday. Analysts were expecting a gain of 11%. The region that includes China and the Americas both did much better than estimates.
Hermès shares rose as much as 5% to a record in early Paris trading, before paring gains. The company’s market capitalization briefly climbed above €300 billion ($314 billion), narrowing the gap with arch-rival LVMH Moët Hennessy Louis Vuitton SE.
The company has outperformed rivals such as Gucci-owner Kering SA and LVMH in part because it caters to the wealthiest clients, whose spending habits tend to be less affected by an economic downturn. Hermès enjoys strong pricing power and waiting lists for its coveted Birkin and Kelly handbags.
Hermès raised prices between 6% and 7% globally so far this year, Executive Chairman Axel Dumas told reporters. The company will also pay a bonus of €4,500 each to its more than 25,000 employees.
Dumas said it’s too soon to say how trends in China and globally will evolve this year. “I stay very positive for 2025, but nevertheless I realize that comparables will be very high. The bar is high.” He said it was too early to talk about a demand recovery in China amid the property market woes.
Dumas said Hermès will pay an additional €350 million in taxes in 2025 following the French government’s decision to increase corporate taxes, a move that’s been decried by his peers LVMH CEO Bernard Arnault and Kering CEO Francois-Henri Pinault.
The quadrupling in Hermès’s share price over the past five years has brought it closer in market value to its larger rival LVMH, which generates more than five times as much revenue annually.
Hermès is “in a league of their own,” Citigroup analyst Thomas Chauvet said in a note.
The company on Friday also announced plans for an exceptional dividend of €10 a share.
All divisions grew in the fourth quarter, even the struggling watches business. The largest unit, leather goods and saddlery, posted an almost 22% increase in sales, topping estimates. Recurring operating income for the year also beat expectations.
Speaking to the risk of US tariffs under the new Trump administration, Dumas said Hermès doesn’t adjust its production according to tariffs. “When tariffs go higher, we’ll increase prices as a consequence.”
“We’re very attached to our production where it is,” he said. “Obviously we have a lot of ‘made in France’ but also ‘made in Switzerland’ for the watches or ‘made in Italy’ for shoes.”
Hermès will seek to launch its first haute couture collection either next year or in 2027, Dumas told analysts and reporters.
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