Hermès vs. Gucci: Quarterly Financial Results

For those who follow the financial performance of luxury brands, it is notable that luxury goods and accessories always do better than luxury fashion, especially when global consumption in these sectors is down overall. 

The latest reports confirmed that Hermès remains a leader, surpassing even LVMH, a conglomerate bigger than Hermès in market cap but burdened with a variety of fashion labels. Similarly, competitor Kering is lagging behind for the same reasons even though the conglomerate has amassed an impressive roster of "hard luxury" brands. None of these have the following that Hermès is enjoying.

Admittedly, all conglomerates have their own "cash cow." Louis Vuitton helps LVMH maintain stellar financial results. Gucci has helped Kering's image soar.

During a time when GenZ and Millenials, the main customer segment of Gucci fashion, are stuck at home in lockdowns, are perhaps experiencing loss of income, and have swapped showing off their Gucci fashions in real life with making funny videos on TikTok, it is not surprising that the parent company's Kering stock fell 6% on Friday.

On the contrary, the enduring quality of Hermès products, including their price resilience in the secondary market, maintains the brand's desirability at a constant high even in a year as unpredictable and challenging as 2020.