Core Viewpoint - LVMH's 2025 financial report shows a decline in overall revenue and profit, but certain segments like Sephora and jewelry have shown resilience, prompting the company to adjust its strategy while awaiting market recovery [1][7]. Financial Performance - Total revenue for LVMH in 2025 was €80.807 billion, a 5% decrease from €84.683 billion in 2024 [3][7]. - Recurring operating profit fell by 9% to €17.755 billion, and net profit decreased by 13% to €10.88 billion [1][7]. Segment Performance - **Wines and Spirits**: Revenue decreased by 9% to €5.358 billion, with recurring operating profit down 25% to €1.016 billion [12]. - **Fashion and Leather Goods**: Revenue declined by 8% to €37.770 billion, with recurring operating profit down 13% to €13.209 billion [5][9]. - **Perfumes and Cosmetics**: Revenue slightly decreased by 3% to €8.174 billion, but recurring operating profit increased by 8% to €727 million [13]. - **Watches and Jewelry**: Revenue was €10.486 billion, with a minor decline in recurring operating profit to €1.514 billion [10]. - **Selective Retailing**: This segment saw a revenue increase of 0% to €18.348 billion, with a significant profit rise of 28% to €1.780 billion [14]. Positive Signals - Operating free cash flow grew by 8% to €11.33 billion, indicating strong cash generation capabilities [6][17]. - Sephora's performance was highlighted, with a focus on expanding its retail network and enhancing customer loyalty [17]. Strategic Adjustments - LVMH is diversifying its portfolio to reduce reliance on the fashion and leather goods segment, emphasizing growth in beauty and selective retail [16][17]. - The acquisition of a 9% stake in Loro Piana for €1 billion reflects LVMH's commitment to high-end market segments [16]. Market Outlook - The management expresses caution regarding the 2026 market outlook, acknowledging ongoing challenges but maintaining confidence in the company's ability to navigate them [15][17].