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Markets Edge · Intelligence Desk MACALLAN 1926

Hermès posts €4.2B Q4 revenue, 11% constant-currency growth as China reverses luxury downturn

The sole Tier-1 luxury house to beat consensus in a quarter that buried peers—and Beijing's stimulus is only starting to clear.

Published July 9, 2026 Source MSN From the chopped neck
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Hermès
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MACALLAN 1926 · July 9, 2026

Hermès posts €4.2B Q4 revenue, 11% constant-currency growth as China reverses luxury downturn

The sole Tier-1 luxury house to beat consensus in a quarter that buried peers—and Beijing's stimulus is only starting to clear.

Source MSN ↗

Hermès reported €4.2 billion in fourth-quarter 2024 revenue on Thursday, marking 11% growth at constant exchange rates and beating analyst consensus of €4.1 billion. The Paris-based house closed the year with €13.4 billion in full-year sales, a 14% annual increase that stands alone among its peer set. LVMH posted flat growth. Kering contracted 11%. Hermès didn't.

China delivered the headline surprise. Greater China revenue rose 13% in the quarter after two consecutive periods of low-single-digit growth, signaling that Beijing's September stimulus package—1 trillion yuan in consumption support and property stabilization measures—is reaching household sentiment. Management cited strong Lunar New Year pre-buying and sustained demand in Tier-1 cities, particularly Shanghai and Beijing, where Hermès operates 24 directly owned stores. Japan grew 22% on the back of a weaker yen and inbound tourism. The Americas posted 10% growth, driven by domestic U.S. clientele rather than Chinese tourist spend, which remains 30% below 2019 levels.

The divergence matters because Hermès is the only luxury house with structural pricing power that doesn't rely on aspirational buyers or wholesale volume. Average transaction values rose 8% year-over-year, driven by leather goods where waitlists for Birkin and Kelly bags now extend 18 to 24 months in key markets. Management noted no discounting in any region, no markdown pressure, and no inventory buildup—a direct contrast to Kering's Gucci, which saw €1.2 billion in unsold stock at year-end. Hermès operates 294 stores globally, adding just 12 in 2024, and maintains a 38% EBITDA margin without relying on fragrance or cosmetics for profit dilution.

The China signal is what allocators should track. Hermès management stated that January 2025 trends in Greater China are holding at the Q4 pace, which implies double-digit growth is persisting into Q1. This aligns with Richemont's recent commentary that Chinese New Year travel and gifting showed the first year-over-year increase since 2023. If sustained, this marks an inflection in the $450 billion global luxury market, where China represents 30% of sales and has been contracting since mid-2023. The stimulus measures are scheduled to extend through June 2025, with 400 billion yuan earmarked specifically for consumer goods. Hermès is the cleanest read on whether high-net-worth Chinese spending is genuinely recovering or simply front-running further currency weakness.

Operators should watch for Hermès's March 21, 2025 full-year earnings call, where management typically provides forward guidance and regional outlook. Pay attention to leather goods production capacity—currently 8,000 bags per year across 21 French ateliers—and whether expansion plans accelerate to meet sustained demand. LVMH reports full-year results on January 28, and Kering follows on February 19; the spread between Hermès's performance and theirs will clarify whether this is a sector recovery or a consolidation of spend among the ultra-wealthy. Richemont's jewelry division, particularly Cartier and Van Cleef, will be the next test case, reporting February 7.

Hermès shares trade at 48x forward earnings, a 20% premium to its five-year average and double the luxury sector median. The stock closed Thursday up 3.2% in Paris. The premium persists because the waitlist is the moat, and the moat doesn't compress when rates rise or sentiment weakens. Beijing's stimulus is simply accelerating what was already inevitable: the reallocation of luxury spend from breadth to scarcity.

The takeaway
Hermès's 11% Q4 growth and 13% China rebound confirm that scarcity-driven luxury is decoupling from sector malaise as Beijing's stimulus hits Ultra-HNW wallets.
hermesluxurychina stimuluspricing powerleather goodsconsumer discretionary
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