Though poised for a challenging start, earnings by luxury brands are expected to remain strong during the later part of Q2, FY25, as per HSBC analysts in their Global Luxury Goods equities division report. While earnings of some major players are expected to decline, others’ are projected to increase year-over-year.

Having reported their Q1, FY26 earnings on July 18, Burberry is expected to witness a decline in revenues as is LVMH whose H1 2025 earnings are also expected to contract. Conversely, earning of Hermès, Richemont, Moncler, and Prada, are expected to grow. Analysts describe the current period as a ‘sobering time for luxury sales,’ noting ‘Liberation Day’ tariff announcements in April impacted confidence, markets, and the US dollar, though May and June are anticipated to show some recovery.

HSBC analysts believe, Q2 2025 will be a ‘more challenging quarter’ overall, likely bringing a sequential slowdown for most luxury brands. However, Burberry will report flat organic retail comparable sales for the second calendar quarter, a significant improvement from a 6 per cent organic decline in Q4. Analysts credit Burberry's successful ‘It is always Burberry weather’ marketing campaign for this resilience.

For LVMH, analysts expect a 7 per cent decline in organic sales in Q2, a steeper decline than the 3 per cent organic contraction in Q1. Nearly all divisions, except Selective Distribution, are projected to show negative performance, with the crucial Fashion & Leather division potentially declining by 11 per cent Y-o-Y

Overall, the report anticipates a sequential slowdown in luxury sector sales growth for Q2 compared to a 0.4 per cent increase in Q1. Nevertheless, Hermès and Prada Group are expected to maintain growth, with Prada benefiting from consistency in terms of product pipeline. While Q2 isn't a significant sales quarter for outdoor winter luxury brand Moncler, it could still see a 2 per cent organic sales increase, with its brand Stone Island projected for a stronger 8.4 per cent organic rise.