The $274 billion luxury house Hermès International might be a little too exclusive. In a lawsuit filed last week, two California shoppers allege that the brand violates U.S. antitrust law by forcing customers for its much-sought Birkin handbags to first buy other items. If successful, the case could crimp Hermès’ fastest-growing segments and ultra-luxe goods’ mystique. Hermès’ must-have aura is burnished by its lofty clientele: Birkin bags sell for at least $10,000 each. The lawsuit alleges that getting to the front of the queue for the carrier is grueling. One plaintiff claims they had to buy tens of thousands of dollars’ worth of

For Compagnie Financiere Richemont, not all that glitters is gold. The $65 billion owner of jeweler Cartier finally agreed to sell a portion of its struggling digital arm, Yoox Net-A-Porter, to high-end online marketplace Farfetch in August 2022. At the time it looked like a savvy fix. But now, Farfetch’s slumping performance means the bling conglomerate could have a new problem on its hands. Richemont’s negotiations with Farfetch to offload YNAP had already dragged on before it signed the deal. Securing antitrust approvals added further delays, and, to date, it still hasn’t closed. To clinch the sale of a 47.5% stake in YNAP,

Tapestry is paying for its latest fashion haul with plastic. The U.S. company behind clothing and accessories brands Coach and Kate Spade said on Thursday that it would scoop up rival Capri for $8.5 billion including debt. The move could help it defend share against higher-end European companies like LVMH amid a pullback in luxury spending at home, but the deal’s steep cost – and the big loan it necessitates – makes for a raggedy ensemble. The merger would give Tapestry a makeover from American laggard to more diversified global conglomerate, bringing Capri’s higher-end brands and European footprint into the fold. The purchase price,

The Refinitiv U.S. Retail and Restaurant Q1 earnings index, which tracks changes in the growth rate of earnings within the sector, is expected to show a 25.5% growth over last year’s levels. Our metrics show that seven of 10 consumer-related industries have turned negative (Exhibit 1). Of the 204 retailers tracked by Refinitiv, the Hotels, Restaurant & Leisure sector is headed for the highest earnings growth rate in the first quarter, recording a 3245.6% surge over last year’s level. In fact, it has been the strongest performing sector over the past year as consumers’ preferences have changed towards services. Making

The first month of 2023 (and the last month of the retail industry’s Q4 2022) saw America’s largest party supply store file for Chapter 11 bankruptcy, a move that the StarMine credit models had predicted about a year ago. The rise in inflation has caused consumers to hold back on discretionary spending. The latest Refinitiv consumer confidence reading also indicates that consumers are concerned about their purchasing power, job security and future expectations. All of this is affecting consumers’ willingness to open up their wallets and hurting retail sales. According to the StarMine Combined Credit Risk (CCR) model, the most

Last year, retailers faced many supply chain issues. Their inventory was constrained at the same time as consumers unleased strong pent-up demand. As a result, retailers had a unique but powerful opportunity to pull back on aggressive discounting, so they entered 2022 with lower promotional levels than in the previous year. However, as inflation reached a 40 year-high, retailers were dealing with weak consumer demand and high inventory levels in the first half of 2022. This has forced retailers to become more promotional to get rid of excess inventory. Now, 40% of the online merchandise for U.S. retailers is on

Prada is en route to join the A-listers on the other side of the luxury sector’s velvet rope. After years of drift, the $18 billion Italian brand has got a grip on its retail network, clamped down on discounting and spruced up its image. That lays the foundations for a jump in sales and profitability. For investors, promotion to the fashion’s premier league is well worth having. Thursday’s shareholder day was only the second such event since the group, controlled by designer Miuccia Prada and her husband Patrizio Bertelli, listed in Hong Kong a decade ago. To mark the occasion, the maker

Tiffany is sparkling in LVMH’s crown. The famous U.S. jeweller, which tycoon Bernard Arnault added to his collection following a bitter $16 billion takeover last year, has bounced back from the pandemic and already appears to be more profitable than in 2019. The performance contradicts the French luxury giant’s attempt to wriggle out of the deal last year. Future LVMH targets will take notice. After declining to complete its biggest-ever purchase in September, the owner of Dior and Givenchy argued in a Delaware court that the pandemic had “devastated” Tiffany’s business, said that management had mishandled the crisis, and accused

LVMH’s once hot pursuit of Tiffany has descended into acrimony. That’s unfortunate, because the U.S. jeweler doesn’t look well suited to life alone. If the $16 billion deal craters, Tiffany could be worth almost a third less than its closing value on Monday. The French conglomerate led by boss Bernard Arnault has filed a lawsuit saying Tiffany has bungled its response to the coronavirus pandemic, and claiming the right to walk. LVMH suggests that Tiffany’s future looks “dismal.” Tiffany, of course, disagrees – and the jeweler filed its own lawsuit against Arnault’s empire earlier in September, accusing it of dragging

Tiffany is no longer worth the $16 billion LVMH offered to pay for it last November. Nonetheless the U.S. jeweler’s board seems bent on forcing French billionaire Bernard Arnault to keep his word, and thinks it has the law on its side. If it wins the day, shareholder value will have prevailed – but an American icon could end up permanently tarnished. The 29% slump in sales in the May-to-July period from a year earlier that Tiffany reported on Thursday isn’t that bad. LVMH’s own watches and jewelry sales halved in its own latest quarter to June 30. But bigger

The COVID-19 pandemic has caused retailers, manufacturers and businesses to close their physical stores around the world. It has disrupted the natural economic cycle and imposed a hard stop on the global economy, making it difficult to predict when we will see a restart. As retailers close their physical stores, consumers turn to online shopping. To track the online trends, Refinitiv partnered with StyleSage Co., which analyzes retailers, brands, online trends and products across the globe. We tracked the average discount percentage retailers are offering and how much retail assortment is on sale since the coronavirus outbreak. Here are some

Richemont faces a triple test to add sparkle to its share price. The $46 billion Cartier owner appears to have weathered a Hong Kong luxury sales slump. Its shares are up 20% in the past year, but an index of top bling groups compiled by Breakingviews is up 50% over the same period. To close the gap, the Swiss group must fend off LVMH-powered Tiffany and deliver on its costly acquisition of online retailer Yoox Net-A-Porter. Richemont on Friday reported sales of 4.2 billion euros for the final quarter of 2019. Though that’s a 4% year-on-year increase at constant exchange