Hermès Ends 2024 on a High Note with Strong Sales Growth

Luxury powerhouse Hermès has wrapped up 2024 with impressive sales growth, reinforcing its status as a leader in the high-end fashion industry. The French brand, known for its exclusivity and craftsmanship, reported annual revenue exceeding €15 billion ($16 billion), marking a 15% increase despite global economic uncertainties. The fourth quarter was particularly strong, with sales surging by 18%, up from 11% in the previous quarter. These figures highlight Hermès’ resilience and strategic expertise in navigating market challenges.

A key factor in this success was the improved performance in China and the broader Asian market. After a period of stagnation, sales in Asia (excluding Japan) rose by 9%, signaling a gradual recovery in the Chinese luxury sector. CEO Axel Dumas expressed cautious optimism, noting, “We see positive signs, but not enough to definitively call it a turnaround.” This sentiment reflects broader industry trends, where some luxury brands, such as Moncler, outperformed expectations, while others, like Kering’s Saint Laurent and Balenciaga, struggled with weaker growth.

However, luxury brands, including Hermès, remain vulnerable to global political and economic instability. The company’s earnings announcement came just as former U.S. President Donald Trump proposed reciprocal tariffs that could affect key trading partners. While trade barriers may increase costs, Dumas stressed that broader geopolitical tensions are a greater concern. He remarked, “It’s not tariffs that concern me the most, it’s the tension between peoples.” Potential tariff increases could lead Hermès to adjust pricing in the U.S. market, although the brand’s cautious pricing strategy may help it navigate these challenges.

Hermès’ sustained success stems from its unique business model, which prioritizes scarcity and craftsmanship. Unlike competitors that rely heavily on regular price hikes, Hermès maintains a more gradual pricing approach. Its highly sought-after Birkin and Kelly handbags, known for their limited availability, continue to drive demand across its product lines. Customers often purchase other Hermès goods in hopes of increasing their chances of acquiring one of these exclusive bags, further fueling overall sales.

Craftsmanship remains a defining element of the brand’s identity. With 74% of its production based in France, Hermès continues to invest in its workforce, creating 1,300 new jobs in 2024. This focus on artisanal expertise sets the company apart from competitors who have shifted towards larger-scale production methods. The brand’s commitment to maintaining quality has kept its loyal customer base engaged without over-reliance on aggressive pricing strategies.

Strong financial results have also translated into benefits for employees. Hermès reported an operating profit of €6.2 billion, accounting for 40.5% of total sales. In recognition of their contributions, employees received a company-wide bonus of €4,500—an increase from €4,000 the previous year. This commitment to rewarding employees reinforces Hermès’ reputation as a brand that values both its heritage and its workforce.

Looking ahead, Hermès continues to show strong potential across key product categories. Leather goods, fashion, and jewelry all performed well, while watches experienced a 4% decline, reflecting broader trends in the watchmaking industry. However, new releases such as the sportier H08 watch and the revival of the Kelly timepiece have been well received, suggesting room for future growth in this segment.

As 2025 unfolds, Hermès remains a standout in the luxury market, demonstrating that a strategic blend of exclusivity, craftsmanship, and brand consistency can drive success even in uncertain economic times. While geopolitical tensions pose ongoing risks, Hermès’ financial strength and enduring desirability place it in a strong position to navigate upcoming challenges. Moreover, its steady recovery in China offers hope that the region’s luxury market may be on the path to sustained growth rather than a brief rebound.