Bernard Arnault confirmed he bought a small stake in Cartier owner Richemont, as the chief executive officer of rival luxury conglomerate LVMH seeks to cool speculation about his intentions.

“I know well the owner, Mr Johann Rupert, of Richemont,” Arnault said in an interview on CNBC broadcast Friday. “And we have a good relationship and I told him that I will never do anything against him. That’s clear.”

It’s “a very minor stake,” Arnault said, confirming a report last month by Bloomberg Businessweek that he had invested as part of a broader family-owned portfolio of investments in publicly-listed companies.

News of the shareholding triggered questions around his intentions for the investment. Richemont has a strong defense against unwanted suitors because Rupert, its chairman, controls 51 percent of the voting rights despite owning only 10.2 percent of the capital. Over the past few years, 74-year-old Rupert has emphasised his desire to keep the group independent.

“He’s done something fantastic with Richemont, with Cartier, with Van Cleef and I think he’s independent, he wants to stay independent and I agree completely on that,” Arnault said.

LVMH owns jewellery brands including Tiffany & Co. as well as Bulgari, meaning a takeover of Richemont would likely attract antitrust scrutiny. LVMH’s fashion brands Louis Vuitton and Christian Dior Couture have jewellery lines, too.

Earlier this week, LVMH Moët Hennessy Louis Vuitton SE posted second-quarter results that missed estimates amid a demand slowdown for high-end goods, particularly in the key Chinese market. Arnault is the world’s third wealthiest individual, with a fortune estimated at around $185 billion, according to the Bloomberg Billionaires Index.

By Angelina Rascouet

Learn more:

Op-Ed | Could LVMH Buy Richemont?

Acquiring Richemont would catapult LVMH into a completely different stratosphere to the rest of the luxury industry, writes Andrea Felsted.

Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.

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Background

Sport and fashion have always been a part of Stéphane Ashpool’s life: He was raised watching his artistic parents socialise with designers like Claude Montana in Paris, while simultaneously falling in love with basketball watching the LA Lakers on TV. He followed both of these passions into adulthood, eventually launching streetwear brand Pigalle in 2008 and going on to collaborate with brands like Nike.

“I have as much curiosity for couture as I have for sport kit,” said Ashpool. “I knew I wanted to kind of blend those things spontaneously. I had no clue what it was going to bring me but that’s why I started to put things together.”

This week on The BoF Podcast, Ashpool joins BoF founder and editor-in-chief Imran Amed to share his journey with clothing brand Pigalle and how his unconventional path into fashion led him to designing the French national team’s Olympic uniforms.

Key Insights

• Raised in the Parisian suburbs with his dancer mother and artist father, Ashpool was deeply rooted in the worlds of sport and fashion from a young age. “I had this charming home, and when I went in the streets, I had this more masculine type of vibe. And that was related to the sport I love the most, which is basketball,” he says. “My mother and her friends were dancers, so I’ve been surrounded by a lot of the gay community, people coming from all over the globe, eccentricity, people that really embrace style.”
• Established in 2008, Ashpool’s brand Pigalle was named for the Parisian neighbourhood he grew up in and born with the district’s multi-dimensional spirit in mind. “I didn’t exactly know what I was doing, but what I did know was the best of both worlds. I like to blend, so I have as much curiosity for couture as I have for sports kits,” he shares. “[At the start] we didn’t know how to handle things, to organise ourselves, but the fire was burning. It was really exciting to enter a lane that no one really did before.”
• When Ashpool was approached by Le Coq Sportif to design the uniforms for the French Olympic team, it came with new challenges and constraints, but Ashpool relished this learning experience. “I really embraced it because even though they put you in a frame, if you managed to break the frame even a little bit, you always got more than what they gave you. I made sure I was pushing the boundaries.”
• For young creatives, Ashpool’s advice is simple. “Dream big, but manage your expectations. Create your own lanes, be inspired, but don’t let yourself be someone else. If you start something, you need to finish it. Don’t teach yourself to not finish something. Otherwise, it’s going to enter your DNA,” he warns. “Be nice to people. It works. Be yourself. It works. Be patient. It works.”

Additional resources

This week, luxury fashion’s biggest players reported falling revenues for a second consecutive quarter, underscoring just how far demand for luxury mega-brands has fallen from post-pandemic highs.

Sales at sector leader LVMH were down 1 percent, while Gucci owner Kering’s revenues dropped 11 percent. Last week, Richemont reported sales down 1 percent. Burberry plunged 22 percent.

There were a few bright spots: Brunello Cucinelli, Hermès and Moncler reported double-digit growth in the last quarter. And it’s clear that Gucci and Burberry, struggling to relaunch under new leadership and aesthetic directions, are saddled with specific challenges. But there is little doubt the industry is feeling the heat.

Macroeconomic gloom is part of the problem.

Around the world, sluggish economies have curbed new wealth creation. In Asia excluding Japan, where LVMH sales dropped 14 percent in the last quarter, economic malaise including collapsing property values and youth unemployment has weighed heavily on consumer confidence in the key China market.

Meanwhile, in the US, aspirational consumers have pulled back on luxury shopping amid slower economic growth. According to data released Thursday, gross domestic product grew 2.8 percent in the second quarter, up on the previous quarter, but down from the unexpectedly strong momentum seen at the end of last year. Economists say the US economy remains resilient but lingering inflation and fears of political instability are putting pressure on the consumer “feel good” factor that’s vital to luxury sales.

Shifting consumer preferences, away from physical goods to experiences like travel, are also part of the equation.

But the slowdown in demand for luxury fashion may be self-inflicted, too.

Big luxury brands trade on a carefully constructed marketing image that is powered by a heady collision of heritage — soaked in old European social hierarchies — and modern celebrity culture. Key to the storytelling are artfully made claims to craftsmanship, creativity and exclusivity. But this image is fraying.

In recent years, brands have hiked prices far faster than inflation as they target wealthy clients to protect profit margins. This has not only alienated Gen-Z and middle-class customers, who are key to growth, but put pressure on luxury’s core value proposition as shoppers wonder if luxury brands are really worth it.

The sector’s price hikes haven’t come with corresponding product innovation. On the contrary, the luxury sector is currently suffering from a lack of creativity from the top, with several major fashion houses creatively rudderless or transitioning to creative directors who are less inclined to bold aesthetic bets.

In stores, brands have sought to justify soaring prices with ultra-classic styles that customers know they’ll wear a lot. But this has contributed to a pervasive sense of sameness.

At the same time, reports of diminished quality are circulating online, undermining craftsmanship claims. An Italian probe into the use of sweatshop labour has hit social media, alongside personalities like Tanner Leatherstein, who chops up luxury bags to show how much he thinks they’re actually worth.

Then, there’s the growing ubiquity of luxury brands, which undermines their sense of specialness, though as Bernstein analyst Luca Solca argues, calculating ubiquity is complicated and ubiquity risk, as measured by key styles appearing too often on the street, has grown far slower than sales volumes.

The industry needs to address rising prices. Can it also tune the other side of the value equation and re-energise belief in the creativity, craftsmanship and exclusivity factors that are so critical to desirability?

September may bring further clarity with star designer Alessandro Michele’s first show for Valentino — as well as fresh revelations from the Italian investigators looking into working conditions in luxury’s supply chain.

What do you think? What’s behind the luxury slowdown? And are luxury brands worth it?

THE NEWS IN BRIEF

FASHION, BUSINESS AND THE ECONOMY

The Olympics will commence Friday evening with an extravagant opening ceremony in the heart of Paris. The sporting event, which will run until Aug. 11, has attracted unprecedented interest from the fashion industry. Traditional advertisers like Nike and Adidas find themselves competing in an increasingly congested marketing environment.

LVMH missed analyst target for revenue in its second quarter. The world’s biggest luxury group saw sales rise 1 percent year-on-year to €20.98 billion ($22.76 billion) in its latest quarter, undershooting the  €21.6 billion expected by analysts. Shares were on track for their biggest one-day drop since October 2023.

Kering weakened as Gucci sales fall 20 percent. The group’s first-half operating profit fell by 42 percent year-on-year. Profits are likely to fall by 30 percent in the second half of the year, the company warned, while offering few promises on when its brands would return to growth.

Hermès sales rose 13 percent on continued appetite for high-end luxury. Sales at the French luxury group in its second quarter grew to €3.7 billion ($4.02 billion), a 13 percent organic sales rise. Its growth signals the continued appetite from wealthy shoppers for luxury handbags, even as less affluent consumers pull back.

LVMH’s L Catterton buys stake in outlet landlord Value Retail in £1.5 million deal. The transaction includes interests in nine luxury retail properties outside major European cities including the Bicester shopping village, about 60 miles northwest of London. It will generate cash proceeds of £600 million for developer Hammerson Plc, the seller of the portfolio.

Moncler’s operating profit beat expectations. The Milan-based group, known for its puffer jackets, said its half-year consolidated revenues totalled 1.23 billion euros ($1.34 billion). Sales rose 5 percent in the second quarter, driven by strong growth in Japan and positive performance on the Chinese mainland.

Zegna posts flat organic revenue. Second-quarter sales fell 0.4 percent year-on-year. Revenue growth at its Zegna brand, which accounts for most of the group’s sales, were driven by ongoing robust growth in the US and EMEA region, but fell by a single digit percentage in the Greater China region.

LVMH pledges more vertical integration in response to the Dior manufacturing scandal. The luxury giant said it was unaware of the issues in its supply chain, despite ongoing efforts to increase auditing and monitoring of external manufacturers. “We accept full responsibility for what happened,” CFO Guiony told analysts in an earnings call.

LVMH holds talks on sponsoring Formula 1. Swiss watch brand owned by French luxury conglomerate LVMH Tag Heuer is in talks to take over as the official timekeeping sponsor of Formula 1 motorsports racing, one of the most expensive marketing agreements in sport. Rolex has served as the official timekeeping sponsor of Formula 1 since 2013.

On arrives at the Olympics revelling in the role of upstart. The company has more than tripled the number of athletes wearing its sneakers at the Paris 2024 Olympics since the Tokyo Olympics in 2021, with 66 athletes using the company’s gear across 18 sports including track and field, triathlon, marathon and tennis.

Saudi Wealth Fund offers to boost stake in Selfridges to 50 percent. The country’s Public Investment Fund already owns a 10 percent share in the Selfridges properties and has offered to buy the remaining 40 percent stake for a cash price of £1 million ($1.3 million) from Signa’s flagship property unit.

LuisaViaRoma opens an outpost in New York’s NoHo neighbourhood. The 16,500-square-foot store is the retailer’s first attempt at international expansion since it opened its doors in Florence 95 years ago. It’s also a bid to recapture the retail magic of once-iconic, now-shuttered New York stores like Barneys or Opening Ceremony.

Off-White and Toteme to show at New York Fashion Week. Area will kick off the Spring/Summer 2025 season on Sept. 6. Off-White, which typically shows in Paris, will make its New York debut under creative director Ib Kamara on Sept. 8, while Swedish label Toteme will show on Sept. 10 after having presented in Paris last season.

Paris Fashion Week to include Alessandro Michele’s Valentino Runway debut. Weinsanto will kick off the week on Sept. 23 and Louis Vuitton will round it out on Oct. 1. Chanel will stage its first ready-to-wear show since Virginie Viard’s departure in June and Dries Van Noten is set to show for the first time without its eponymous designer.

THE BUSINESS OF BEAUTY

The Body Shop is expected to emerge from administration. Charles Denton, the former Molton Brown chief executive who leads the consortium that has agreed to buy The Body Shop, said he expects the company to emerge from administration in August. The consortium agreed to buy The Body Shop out of insolvency last week.

Interparfums sales rose 11 percent. The fragrance-maker for brands such as Jimmy Choo, DKNY and Karl Lagerfeld posted second-quarter net sales of $342 million, beating analyst estimates of $339 million. Interparfums’ European operations rose 14 percent, while its US arm grew by 8 percent.

L’Occitane to delist from Hong Kong Stock Exchange. The company is set to exit the public market in August after shareholders voted to approve such a move. Chairman, Reinold Geiger, who owns more than 70 percent of the company’s shares, said the transaction will provide the group with the flexibility to make longer-term business decisions.

PEOPLE

Creative director Peter Hawking exits Tom Ford. Peter Hawkings, longtime deputy of Tom Ford who took over as the brand’s creative director in 2023, has exited the business. A successor will be announced in the “near future,” according to Tom Ford owner Estée Lauder Companies.

Sergio Rossi taps Paul Andrew as creative director. Andrew previously served as creative director of Salvatore Ferragamo, where he was the first designer to oversee all categories for the family-owned brand. Sergio Rossi is owned by China’s Lanvin Group.

Estée Lauder Companies names Akhil Shrivastava executive vice president and chief financial officer. Shrivastava succeeds Tracey Travis, who is set to retire after holding the position since 2012. Travis will remain at the company in a support role until next year.

Nike hires former Salesforce executive in tech division shakeup. Cheryan Jacob, who has previously worked at Microsoft as well, will lead efforts to modernise technology infrastructure as chief information officer for the world’s largest sportswear company.

MEDIA AND TECHNOLOGY

Essilorluxottica confirms Meta interested in stake. CEO Francesco Milleri said the maker of Ray-Ban and Oakley sunglasses isn’t planning a capital increase dedicated to Meta and the tech giant would buy shares on the market if it wants to become a shareholder. He didn’t elaborate on the size of the stake Meta may buy and on the timing of the purchase.

Compiled by Yola Mzizi.

Welcome back to Haul of Fame, your must-read beauty roundup for new products, new ideas and a return to slime.

Included in today’s issue: Ciate London, Cover FX, Elemis, Hanni, Henry Rose, Joylux, Kiehl’s, the Lip Bar, Merit Beauty, the Outset, Pat McGrath Labs, Phlur, Prada Beauty, Snif, Tarte, Too Faced, Tonymoly, Tower 28, Undefined Beauty and the luscious reign of pond scum.

But first

When the sheet mask brand Loops looked at their 2024 numbers, they saw something new: Profitability. The New York-based company hit the scene in 2020 with a line of super-squishy face masks made in Korea — right when stay-at-home beauty rituals became a self-soothing mechanism for millions of quarantined Americans.

In 2022, the indie brand made its first big hire with CEO Meg Bedford, who began her career in magazine publishing before helping Tom Ford and Pat McGrath launch their nascent beauty lines.

Bedford’s strong digital background, combined with her Hollywood-adjacent career, put her in a unique position at Loops: She knew the indie brand needed to stay in its lane as “simplified skincare” — or as I call it, “drunk girl skincare,” which she didn’t disagree with — but also amplify its social media presence and diversify its product line beyond masks.

Enter the Wrapping Mask, a tube of extra-hydrating serum drops today. Loops claims has all the benefits of a hyaluronic sheet mask, but without the actual sheet. (In this way, it’s a bit like the “tightening” body creams that promise to be like invisible corsets. It’s launching today after a year in development in Seoul, Korea, and comes with a co-sign from Camila Mendes, the actress who also became Loops’ “creative director” in 2022, shortly after Bedford’s tenure began.

“We love her, obviously,” said Bedford, noting that Mendes has been styling and art directing shoots for the new product, along with a line of biodegradable skincare wipes for concerns like hydration, brightness, and oil, which also debut today. “She has such a creative mind, and is amazing at collaboration and connection.”

The popularity of Mendes is one reason Loops has hit their financial benchmarks, says Bedford, but the investment in quality formulas is another. “We try not to scale too quickly because we know if we don’t get the actual product right, it won’t matter,” Bedford explained. “It’s amazing that celebrities and influencers and micro influencers want to talk about our product.” (TikTok posts have included Loops Beauty products in nearly 4 million videos; according to social media analytics, Loop Beauty content has been viewed over 300 million times on that platform alone.)

Now, Loops Beauty is confronting something far larger, and less sexy, than celebrity buzz. “I lie awake at night thinking about air-shipping versus ground shipping,” she said. “We launched in CVS in April in 3800 doors. Now they want another 1500 doors. Do we meet the demand, but have less profitability because [of rushed production]? Do we lean into scarcity a little bit more? It’s such a good problem to have,” she laughed. “But it’s not going to be solved by star power.” Just good ol’ data analytics, and a lot of bouncy skin.

What Else Is New

Skincare

Indie skincare darling Tower 28 dropped SOS Daily Balancing Gel Cleanser on July 22. It claims to remove SPF and makeup in one go, and helps the skin replace electrolytes because Gatorade is cheaper than a facial.

Hanni has 10,000 aura points, or at least 10,000 people on its waitlist for Good Aura Body Oil. After being sold out for nearly a year, the product is back with new aluminium packaging for optimum recycling.

On July 23, Kiehl’s launched Auto-Tone Discolouration & UV Solution. But don’t let the name freak you out: It’s basically just SPF 30, in a formula that evens out the skin tone. It costs $52.

Also on July 23, a new brand — Heavenly by Nia — launched with a Soothing Star Moisturiser and Sky’s Foam Cleanser. The products are the brainchild of a young woman named Niamarie Vargas, who developed the line to help her little sister get clearer skin. They come packaged in Brat Summer green tubes, with throwback computer fonts last seen on Oregon Trail screens.

The skin barrier continues to prosper! Undefined Beauty debuted its R&R Repair Mist, “a versatile skin barrier boosting spray, supercharged with Hypochlorous Acid,” on July 23. It’s $18.

Also back in the spotlight: premium pond scum. On July 23, Elemis introduced its Pro-Collagen Future Restore Syndrome, which includes “marine microalgae diatoms” — tiny organisms that live in silica drops the way snails live in shells.

The gap between sex care and skincare continues to close. On July 22, Joylux rolled out a small red-light wand that it claims can help users “experience more natural lubrication, increased sensation, a stronger pelvic floor and a feeling of tightness.” So … Sola Wave for your uterus? It’s $400 and counts an OB-GYN, Dr. Sarah de la Torre, as a co-creator.

Ciate London launched a combo lip-balm-and-mask on July 19. It’s called Watermelon Burst and smells a tiny bit like a Jolly Rancher.

The Outset’s Cool Cream Smoothing Mask hit shelves on July 26. It promises a cooling sensation along with more moisture, and counts “electric daisy” — also called the “toothache plant” for its herbal healing history — as a key ingredient. Cue the ScarJo + Colin Jost video tutorial in 4…3…2…

Makeup

Prada Beauty released its ever-so-slightly green setting powder on July 22. It claims to control shine and deliver a soft matte finish, and costs $90. I’d wager that $80 of that is for the mixed-metal packaging stamped with Prada’s pristine logo, but hey, it’s extremely chic.

On July 25, The Lip Bar introduced its Nonstop Liquid Matte Lipstick in a hot pink, shimmer-infused shade called Very Rich. It is Barbiecore-adjacent and looks quite divine in colour swatches.

Tonymoly’s new lip balm dropped July 25, too. It’s a collab with the toy brand Squishmallows, and has tiny cartoon cats and pigs. Adorbs, but also: When is Jellycat going to release a jelly gloss line? Surely ColourPop or e.l.f. are on this beat…

Getting picked last in gym class always sucked. Getting picked last in the WNBA draft, though? That gets you a beauty deal, at least if you’re Cover FX. The makeup brand’s new campaign, “Ms. Irrelevants,” launched July 24 with basketball star Angel Jackson, tennis pro Solymar Colling, and soccer player Talia Gabarra — all of whom “are the last pick” of their respective league drafts, according to a press release. It’s always fun to root for underdogs, but a campaign like this needs a heavy dollop of wit to show the brand isn’t negging its talent. To me, the imagery looks a little too harsh to read as an inclusive, subversive gag. It’s not there yet. But the women’s foundation-dabbed skin? Flawless.

Palette news! Pat McGrath Labs launched two new shadow quads — Opalescent Orchid and Nirvana Nectar — on July 23. They both boast super-rich colour payoffs and ultra-fine grains of glitter. Also on July 23, Too Faced unveiled Appley In Love, an 18-shade compact that, like Elle Woods’ resume, is scented. (This one has a whiff of caramel.) Tarte has a new palette, too, for its 25th birthday. It launched on July 19 and has the 28 best-selling shades from the brand. It’s $54, so … uh … $1.90 per shadow?

On July 26, Merit Beauty debuted Brow 1990, a gel pencil in four shades. They tapped author and mental health advocate Gemma Styles to test it out on her Instagram — and show her super-thin brows circa 2010 in a flashback photo. It’s a cool way to tap into celebrity culture and cultural discourse all at once, and the formula looks effective onscreen.

Fragrance

Phlur’s new hair and body mists — Coconut Skin and Caramel Skin, which smell exactly like they sound — dropped on July 24. They cost $38, and speak to the fact that premium scents are going hard on the category, too. I’m still an eau de parfum girl, but I also still use PowerPoint instead of Canva. This body mist move feels like the fragrance equivalent.

Snif’s collaboration with YouTuber Monet Mcmichael is finally live on its website. The scent is called Rose Era, and has notes of flowers along with “clean laundry accord” — basically, just a whiff of soft cotton and fabric softener.

Michelle Pfeiffer’s brand, Henry Rose, introduced its Jake’s House BVI scent on July 22. It has “marine citrus skin musk” which sounds like you’re eating oranges in the ocean. Could be fun.

Also, wait, did you guys know Sabrina Carpenter was launching a perfume?!

And finally…

It’s really interesting that The Sloomoo Institute — a “slime museum” in New York City that’s part Instagram content factory and part extended gift shop — has poached Sandra Gil as its marketing head, since Gil was head of brand at Vintner’s Daughter. Is Sloomoo headed into a product expansion phase aimed at Gen Alpha? Slimy self-care could be a good bet. Plus, Sloomoo’s co-founder is Karen Rabinowitz also co-founded the influencer agency Digital Brand Architects, a cash machine for TikTok stars and beauty brands.

Birkin-bag maker Hermès reported a 13 percent rise in second-quarter sales on Thursday, demonstrating the continued appetite from wealthy shoppers for its luxury handbags, even as less affluent consumers pull back.

Sales at the French luxury group grew to €3.7 billion ($4.02 billion), a 13 percent organic sales rise that strips out currency fluctuations. The figure was in line with analyst expectations, according to a Visible Alpha consensus.

Operating profit for the first half was €3.1 billion, compared to a forecast from consensus provider Visible Alpha for €3.2 billion.

By Mimosa Spencer; Editor: Alexandra Hudson

Learn more:

Case Study | Inside Hermès’ Best-in-Class Leather Goods Strategy

How a unique approach to supply chain, design, communications and retail has powered blockbuster demand for iconic bags like the Birkin and Kelly, enabling the French leather goods house to face down rivals and become a global megabrand with a market capitalisation greater than Nike’s.