Surpassing analysts’ expectations, demand for luxury products by Hermes increased by 17 per cent at constant exchange rates to €3.8 billion ($4.1 billion) during Q1FY24.

Revenues of the brand in key Asia markets excluding Japan rose by 14 per cent to €1.92 billion during the quarter. Additionally, its leather goods and saddlery division outperformed estimates with robust 20 per cent growth.

Known for its appeal to the most affluent clientele, Hermes has weathered the challenges facing the luxury market with notable success. This stands in contrast to the struggles of Kering SA, particularly in its efforts to revitalise its flagship brand, Gucci, a process that is proving to be time-consuming.

Although Hermes noted a decline in foot traffic in Greater China, particularly in March, following the Chinese New Year, purchases of higher-end leather, ready-to-wear, and jewelry items increased during the period. Eric Du Halgouet, Chief Financial Officer explains, number of customers opting for more affordable products like silk scarves declined slightly during this period. However, there was a notable uptick in those splurging on luxury goods.

Hermes' perfume and beauty, as well as silk divisions grew by 4.3 per cent and 7.9 per cent, respectively, throughout the quarter.