Dive Brief:

• LVMH Moët Hennessy Louis Vuitton on Monday said first quarter revenue rose 15% to €9.9 billion. Organic revenue growth (with comparable structure and constant exchange rates) was 13% over the year-ago period. Positive growth was achieved in Asia, Europe and the U.S., according to a press release. The results beat analyst expectations for revenue growth of 8% to €9.5 billion, according to the median of 17 estimates compiled by Bloomberg. 

• During the first quarter, LVMH benefited from a favorable comparison base, particularly in Europe, where activity was affected last year by the impact of the November 2015 attacks in Paris. As a result, the company said the trend currently observed cannot reasonably be extrapolated for the full year.

• By segment, its wines & spirits business grew 13%, fashion & leather goods business grew 15%, perfumes & cosmetics grew 12% (with Guerlain benefitting from the launch of the new women’s fragrance Mon Guerlain, promoted by Angelina Jolie and Parfums Givenchy benefiting from the success of its lipstick lines, which had rapid development in Asia) and its watches & jewelry business grew 11%. In “selective retailing,” which includes Sephora, Q1 organic revenue growth was 11%.

Dive Insight:

LVMH's success this quarter was bolstered in part by the fact that it's coming off muted results from last year. The luxury goods company warned investors on Tuesday that it likely won't continue to pull off such large boosts in revenue and sales all year. Nevertheless, investors warmed to the company’s prospects late Monday, sending shares to a record high in Paris trading.

Despite the warning, the company’s results indicate a thaw in luxury sales, which in recent quarters had suffered from the strong dollar and, for LVMH in particular, a slowdown in tourism to Europe after terrorist attacks last year. “As the sector bellwether, LVMH’s beat should support the luxury space,” wrote Rogerio Fujimori, an analyst at RBC Europe, in a note cited by Bloomberg, adding that the results “raise the bar for other stocks reporting in coming weeks.”

LVMH enjoys a highly diversified portfolio of goods, and all segments did well in the the first quarter. In a rare move, the company last year sold its Donna Karan brand to G-III Apparel Group, Ltd, inking the second sale it has made in 30 years. LVMH bought Donna Karan in 2002 for about $243 million, after it had gained popularity for its designs for the working American woman. The brand was the first major American designer label for the company, and one of LVMH's biggest moves into the ready-to-wear industry.

“In a particularly uncertain environment, LVMH will continue to focus its efforts on developing its brands, maintain strict control over costs and target its investments on the quality, excellence and innovation of its products and their distribution,” the company said in a statement Monday. “The Group will rely on the talent and motivation of its teams, diversification of its businesses and good geographical balance of its revenue to reinforce, once again in 2017, its global leadership position in luxury goods.”