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Hermès to raise prices as sales remain buoyant

By Don-Alvin Adegeest

21 Oct 2022

Business

Image: Hermès SS23

Hermès revenue surpassed analyst’s expectations, beating estimates of a 15 percent increase to a record 24 percent. Despite a dip in share value, with shares having fallen nearly 15 percent in 2022, high spending tourists, especially Americans with a strong dollar, kept the luxury giant well ahead of competitors. By comparison Kering posted revenue increases of 14 percent, but its stalwart brand Gucci saw sales below expectations with a marginal growth of 9 percent.

“For the moment, we don’t see any sign of slowdown in any of our markets,” Hermès Executive VP of Finance, Eric du Halgouet, told Reuters during an earnings call.

Like other luxury houses, Hermès has shrugged off economic woes for its high spending clients, and is expected to raise prices between 5 and 10 due to rising costs and currency fluctuations. According to Reuters this increase is “much more than in the past, after a sharp rise in sales over the third quarter with no signs of any slowdown yet.”

The Paris-based company said it would also accelerate a hiring drive in H2, in line with 800 new jobs it created in H1. In July the company increased salaries for its European employees as inflation took its toll.

HERMES
KERING
Luxury