First Quarter 2024 Revenue Report
- Thread starter A.Ali
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(not clicking) It's bizarre to me that there's a shopping public (vs. shareholders) who might care about, let alone read, a retailer's revenue report.
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Did not read the details but saw the headlines. Since profit is up, I'm assuming demand is still great and even less chance for me to get a k or b or any handbag at retail store. 🤔
Thank you ! Quite interesting. I read that second tier, big brand, luxury retail (kering group, YSL, Gucci) did not do nearly as well which is why the recommend on stock price was still neutral, not full out buy. It makes me think that top tier like this will continue to weather economic ups and downs. (This is not my wheelhouse) so if I have inadvertently made erroneous statements, pls feel free to correct lol
Interesting but not surprising they're continuing to do so well as they are continuously looked upon as the top luxury brand. I feel demand will only grow higher and higher for them so we can continue to see these type of numbers (even though there's been reports of luxury slowdown in places like Asia which is a huge market in general).
Case in point: https://www.bloomberg.com/news/arti...efies-luxury-slowdown-with-sales-jump-in-asia
Case in point: https://www.bloomberg.com/news/arti...efies-luxury-slowdown-with-sales-jump-in-asia
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Slightly off topic but agreeing with @china_doll above - last night my daughter (Economist) mused whether Hermes is acting as an effective monopoly supplier since no other brand is quite the same. Results of Kering and YSL etc seems to indicate that…
well I guess we can all be quite proud of contributing to their success 
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I read annual reports as part of my job - and I think the implications of these results are very interesting (for me) to contemplate. In my view, the result is indicative of our current economic situation and uncertainty: people who can afford to buy, buy high end luxury. People that save to buy prefer to buy something that holds its value, so at the moment, that is by and large Hermes and Chanel - for example, Evelyne tpm flies off the shelve because it is at a price range that many more can afford than a B or K, and you buy into the brand this way (a bit like how the Chanel Woc used to work) and they have a great resale value.
Other luxury retailers have clearly indicated that they earn less than their forecasted revenues and are contracting rather than growing - these are 'second tier' luxury retailers - relative to Hermes, you might consider their goods affordable. But they are less relevant in the current climate because they don't hold their value and as always, during an economic downturn, we look for what holds our 'investment' or might even appreciate in value.
I won't exempt myself from this - when making a choice to spend money, I always choose to spend on Hermes over any other luxury brand, because in my experience, the intangible and realisable value is typically higher than any other brand. Case in point, I missed the return period for a recently released H bag but it didn't work out for me: I sold it for more than retail to a reseller. I don't think this would happen with any other brand, except perhaps Chanel (I have no experience with them, so can't confirm).
not sure I would consider a very appealing value proposition and competitive advantage monopolistic - that would imply they are the ONLY provider but they are not - we can choose to buy any other brand, but we don't want to - that just means they are very good at what they do and no one else can compete quite at the same level.
.I read annual reports as part of my job - and I think the implications of these results are very interesting (for me) to contemplate. In my view, the result is indicative of our current economic situation and uncertainty: people who can afford to buy, buy high end luxury. People that save to buy prefer to buy something that holds its value, so at the moment, that is by and large Hermes and Chanel - for example, Evelyne tpm flies off the shelve because it is at a price range that many more can afford than a B or K, and you buy into the brand this way (a bit like how the Chanel Woc used to work) and they have a great resale value.
Other luxury retailers have clearly indicated that they earn less than their forecasted revenues and are contracting rather than growing - these are 'second tier' luxury retailers - relative to Hermes, you might consider their goods affordable. But they are less relevant in the current climate because they don't hold their value and as always, during an economic downturn, we look for what holds our 'investment' or might even appreciate in value.
I won't exempt myself from this - when making a choice to spend money, I always choose to spend on Hermes over any other luxury brand, because in my experience, the intangible and realisable value is typically higher than any other brand. Case in point, I missed the return period for a recently released H bag but it didn't work out for me: I sold it for more than retail to a reseller. I don't think this would happen with any other brand, except perhaps Chanel (I have no experience with them, so can't confirm).
not sure I would consider a very appealing value proposition and competitive advantage monopolistic - that would imply they are the ONLY provider but they are not - we can choose to buy any other brand, but we don't want to - that just means they are very good at what they do and no one else can compete quite at the same level.
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In a strange way hearing the high results make me happy. Happy that Hermes is financially strong to not get acquired (unless they want to) which means tradition of "quality"and "handmade" and "repairs" will continue on.
Anyone compare fourth quarter 2023 to first quarter 2024 because to me that’s what’s interesting. That q1 report compared q1 2023 and 2024. When you look at revenues for the Americas there looks to be a sizable drop from last year q4 to q1 this year. China is up but first quarter consisted of lunar new year and singles day. I saw reports that Chinese consumers returned about 70% of luxury items in first quarter. I’m guessing this primarily didn’t include Hermes (why? Probably some of it has to do with fear of losing a qb; perhaps they resell instead!) but it is telling about economic conditions there. If I’m recalling correctly during the press release there was mention that there are economic headwinds that may impact the rest of this year for h. I do think h is benefitting from the very wealthy continuing to spend. I also think most foot traffic is not the super wealthy and the lower end aspirationals while still buying have slowed down their spend. If you look at the beauty category the spend was up there which is what normally happens when the economy isn’t so hot but down in watches. That to me signals a slight slowdown in qb chasers. h bags prices in the second hand market have dropped significantly since their height. In fb reseller groups I am even seeing Lindy bolide tpm etc brand new going for close to retail. I think it’s also interesting that notwithstanding the 8% price increase there was such a drop from q4 to q1. But hey what do I know I’m no economist. And as to impact as a non shareholder I’m interested because a decrease in revenue means lower the demand which means better hopes of grabbing a couple bags I’ve been after off the website. I did notice leather goods revenue was up significantly so the brand must have been really churning out those tpm and herbags this year. The brand is really the it brand rn. The TPM is like the new lv neverfull. Also lower revenue also translates possibly to better service. Sa’s more willing to hunt for something for you. Respond more timely with request or actually respond.
Q4 is a holiday quarter for many locales. My preference is to look at TTM in financial statements vs. purely quarters as it gives a much smoother view.
True. In the U.S. q4 is when Americans go all out with spending given the holidays. Typically q1 tends to be slow because of all the overspending from previous quarter but I don’t think I’ve seen it drop this much. Could be wrong. Second quarter may pickup in the us with people spending tax refunds but I hear they’re smaller this year and likely people are still paying down debt with refunds.
In mainland China Hermes doesn’t allow refunds? Interesting! In Hong Kong they allow refunds for website purchases.