Report: Chanel Sees Slowdown in Luxury Sector Sales in US

Chanel has reportedly seen a slowdown in the United States.

The privately-held luxury brand’s sales growth in the U.S. has dipped from about 10% in 2022 to “in the single digits” this year, the Financial Times (FT) reported Thursday (May 25).

“We had a softening in the U.S., so no different from some of our competitors, from November of 2022, and that’s continued over the first few months of 2023,” Chanel Global Chief Financial Officer Philippe Blondiaux told the FT.

Chanel did not immediately reply to PYMNTS’ request for comment.

Blondiaux’s comments come during a week in which investors’ concerns about the luxury sector’s outlook in the U.S. contributed to a drop in some of the sector’s stocks, with LVMH down 6.8%, Kering down 6.8% and Hermès down 4.3%, according to the report.

However, Blondiaux said Chanel remains confident in the outlook for this year and through 2025, per the report.

Chanel has seen double-digit growth in China after the lifting of the country’s COVID restrictions and a rise in sales to Chinese customers in other countries as Chinese tourism has returned, the report said.

One of the company’s competitors in the luxury segment, LVMH, reported in April that its 17% increase in sales in the first quarter was driven in part by a resumption of shopping by Chinese consumers.

Global luxury group Kering said its performance in the first quarter was mixed. Its revenue grew 2% in the first quarter, with “good momentum” in Western Europe and Japan, a resumption of growth in Asia-Pacific and a decline in North America.

Hermès reported 23% revenue growth in the first quarter, with sales “particularly dynamic” in all geographical areas. In the Americas, sales were up 19%.

In Europe, there was a 77% increase in the number of luxury store openings last year as global travel resumed.

“A relatively fast recovery in luxury spend in the region, helped in part by the return of international visitors no doubt moved Europe back up the agenda for expanding luxury brands,” real estate agent Savills said in its Global Luxury Retail Outlook.

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