Luxury Fashion Sector Returns to Growth as US and China Lead Recovery

The global luxury fashion market posted a rebound in the second quarter of 2026 after a downturn that began in late 2022. Growth was driven primarily by the United States and China, where leading conglomerates such as LVMH, Kering, Prada, Hermès and Chanel refocused on ultra‑high‑net‑worth customers and new creative directions. The BoF "State of Fashion" report projects a 5% annual growth rate for the U.S. market and up to 6% for China through 2030.

LVMH reported a 1% year‑on‑year sales increase in its fashion and leather goods division, with Dior outperforming the group after the launch of Jonathan Anderson’s collections. Overall revenue for the conglomerate rose 3%. Kering also posted a 2% rise, helped by its eyewear and jewelry segments. The recovery reflects strategic portfolio adjustments, reduced entry‑level accessory production, and a shift toward the highest‑spending clientele.

Separately, analysts highlighted the succession challenge at LVMH, noting that the focus on identifying a single heir for Bernard Arnault may be misplaced. Commentary urges the Arnault family to develop a continuous leadership pipeline rather than relying on a sole successor, emphasizing broader governance reforms for family‑owned enterprises.