Core Viewpoint - The luxury goods market is experiencing a downturn, with a significant reduction in the number of consumers and a decline in overall spending, impacting major players like LVMH [4][5]. Group 1: Market Trends - The luxury goods consumer base is projected to shrink from 400 million in 2022 to 350 million by the end of 2024 [4]. - The total global luxury goods consumption is expected to be approximately €1.48 trillion in 2024, reflecting a year-on-year decline of 1%-3% [4]. - Only about one-third of luxury brands are expected to achieve growth amid the market slowdown [4]. Group 2: LVMH Performance - LVMH reported a 4% year-on-year decline in total revenue for the first half of 2025, amounting to €39.81 billion [5]. - The net profit for LVMH decreased by 22% to €5.69 billion during the same period [5]. Group 3: Strategic Moves - Bernard Arnault, CEO of LVMH, continues to visit China, indicating the importance of the Chinese market despite the overall downturn [3]. - LVMH executives have shown interest in local brands, with a notable increase in demand for Chinese jewelry companies [6]. - The overlap in consumer demographics between local brands like Laopuhuangjin and international luxury brands is significant, with a 77.3% overlap rate [6].

Group 1 - Bernard Arnault, CEO of LVMH, was spotted in Shanghai, marking his third consecutive year visiting China [1] - LVMH's flagship store, the "Louis" giant ship, has become a new landmark in Shanghai, attracting global tourists [1] - In 2023, Arnault was recognized as the world's richest person with a net worth of $211 billion (approximately 14,500 billion RMB) according to Forbes [1] Group 2 - During his visit, Arnault toured the Laopai Gold store in Shanghai, showing interest in various gold items and commenting on their craftsmanship [1] - This visit follows a previous trip by another LVMH executive to Laopai Gold in Beijing earlier in June [1]

Core Insights - LVMH and Kering reported declines in their performance for the first half of the year, while Prada Group experienced growth, highlighting a divergence in the luxury market [2][6][7]. Financial Performance - Prada Group's net revenue for the first half of 2025 reached €2.74 billion, reflecting a 9% increase year-over-year at constant exchange rates [2][3]. - Retail sales net revenue grew by 10.1% year-over-year, while net profit slightly increased to €386 million, up 0.62% [2][4]. - The Prada brand saw a decline in retail sales net revenue by 1.9%, while Miu Miu's retail sales surged by 49.2%, contributing significantly to the group's overall performance [2][4][10]. Brand Performance - Miu Miu has entered a high-growth phase, with a retail sales net revenue increase of 92.7% in 2024, and it now accounts for nearly 32% of Prada Group's total retail sales net revenue [4][15]. - Despite Miu Miu's strong performance, the growth rate has slowed compared to previous years, indicating potential challenges ahead [16][18]. Regional Performance - Prada Group achieved growth across all regional markets, with the Middle East showing the fastest retail sales growth at 26% year-over-year [10][12]. - In the Asia Pacific region, retail sales net revenue increased by 10.4% to €838 million, while Europe, the Americas, and Japan also reported positive growth rates [12][10]. Market Dynamics - The luxury market is experiencing a slowdown, with major brands like LV and Gucci facing challenges, while Prada Group's strategic focus on brand positioning and younger consumer engagement has allowed it to thrive [14][15]. - The shift in consumer preferences towards brands like Miu Miu reflects a broader trend in the luxury sector, where younger generations are driving demand [16][18].

Core Viewpoint - In the first half of 2025, while major luxury brands like LVMH and Kering reported declines in performance, Prada Group experienced growth, driven primarily by its Miu Miu brand, which has seen significant sales increases [1][5][11]. Financial Performance - Prada Group reported a net income of €2.74 billion, a 9.1% increase year-on-year, with retail sales netting €2.45 billion, up 10.1% [1][5]. - The adjusted EBIT rose by 7.55% to €619 million, and net profit increased by 0.62% to €386 million [5][12]. - Prada brand's retail sales net income decreased by 1.9% to €1.65 billion, while Miu Miu's retail sales surged by 49.2% to €780 million [1][5][7]. Brand Performance - Miu Miu accounted for nearly 32% of Prada Group's total retail sales in the first half of 2025, marking a historical high for the brand [4][14]. - Miu Miu's retail sales growth has been robust, with a 92.7% increase in 2024, and it successfully entered the "€1 billion club" [4][14]. - Despite Miu Miu's strong performance, its growth rate has slowed compared to previous years, indicating potential challenges ahead [15][17]. Regional Performance - Prada Group achieved growth across all regional markets, with the Middle East showing the fastest retail sales growth at 26% [7][8]. - In the Asia-Pacific region, retail sales increased by 10.4% to €838 million, while Europe, the Americas, and Japan saw increases of 9%, 12%, and 4%, respectively [7][8]. Market Trends - The luxury goods market is experiencing a slowdown, with a report indicating the first decline in luxury consumption in 15 years, excluding the pandemic period [12]. - The shift in consumer preferences towards younger brands like Miu Miu suggests a changing landscape in luxury brand appeal [11][12].

Core Viewpoint - The luxury goods growth model is being questioned as Prada Group's recent performance raises concerns, following disappointing results from other luxury giants like LVMH and Kering [1][8]. Financial Performance - Prada Group reported an adjusted EBIT of approximately €618.5 million, a year-on-year increase of 7.55% [2]. - Net income was around €386 million, reflecting a 0.62% year-on-year rise [2]. - Earnings per share stood at €0.151 [2]. - Retail sales net revenue increased by 10.1% year-on-year, accounting for 89.5% of total net revenue [2]. Brand Performance - Prada brand's retail sales net revenue slightly decreased by 2% when calculated at constant exchange rates, while Miu Miu's retail sales net revenue surged by 49% [3]. - Miu Miu's sales growth in the second quarter slowed down significantly compared to previous quarters, which saw growth rates of 93%, 105%, and 84% [7]. Regional Performance - All major markets showed growth: Asia-Pacific retail sales net revenue increased by 10.4%, Europe by 8.6%, the Americas by 12.4%, Japan by 4.3%, and the Middle East by 25.7% [7]. Market Challenges - Morgan Stanley noted that Prada's second-quarter performance was below expectations due to a slowdown in luxury consumption among cross-border travelers, with a year-on-year sales growth rate of 6.1%, down from 12.5% in the first quarter [7]. - Prada's CEO highlighted that the current market challenges are more cyclical rather than structural [1]. Strategic Outlook - For the second half of the year, Prada issued a warning about uncertainties in the recovery of the tourism sector but emphasized three certainties: maintaining a full-price sales strategy, reviewing operational efficiency quarterly, and avoiding shortcut growth strategies [7]. - Prada aims to sustain growth through precise retail strategies and new store openings, while Miu Miu plans to expand its market share in leather goods and introduce new store experiences globally [7].

Core Viewpoint - The luxury goods growth model is being questioned as Prada Group's recent performance raises concerns following disappointing results from other industry giants like LVMH and Kering [2][6]. Financial Performance - Prada Group reported an adjusted EBIT of approximately €618.5 million, a year-on-year increase of 7.55% [3]. - Net income was around €386 million, up 0.62% year-on-year, with earnings per share at €0.151 [3]. - Retail sales net revenue increased by 10.1% year-on-year, accounting for 89.5% of total revenue [3]. - Retail sales net revenue for the Prada brand slightly decreased by 2% when calculated at constant exchange rates, while Miu Miu's retail sales net revenue surged by 49% [3]. Regional Performance - All major markets showed growth: Asia-Pacific retail sales net revenue grew by 10.4%, Europe by 8.6%, the Americas by 12.4%, Japan by 4.3%, and the Middle East saw a remarkable increase of 25.7% [5]. - Morgan Stanley noted that Prada's second-quarter performance fell short of expectations due to a slowdown in luxury consumption among cross-border travelers, with a year-on-year sales growth rate of 6.1%, down from 12.5% in the first quarter [5]. Market Challenges - The luxury sector is facing significant challenges amid economic uncertainty and cultural shifts, potentially leading to the largest setback in 15 years [6]. - Even leading brands like LV and Dior are showing signs of fatigue, with LVMH's core fashion and leather goods revenue declining by 9% and net profit dropping by 22% [6]. Consumer Trends - Younger consumers, particularly Generation Z, are increasingly questioning the value of luxury goods, moving away from the traditional perception of luxury as a status symbol [7]. - Brands with less prominent logos, such as Loro Piana and Brunello Cucinelli, are experiencing growth, indicating a shift towards understated luxury [8].