Ben Gilbert: evaluation

Transcript context

…I bet there, probably also, are a good number of customers who did graduate to the high price point items over the last couple of years. Then now as the economy in particular, certain sectors of the economy like tech have violently rerated here, might graduate out. The number of people that we know, David, that a year-and-a-half ago thought they were millionaires, 10 millionaires, or even higher, and are now realizing that they're not, I bet a lot of those people were buying luxury goods. Another one, this is very short-term, but luxury goods were on a tear during Covid. Obviously, China sales fell off a cliff as everyone was locked down. But globally, the luxury market grew 22% last year and is projected to slow down 3%–8% next year. That's a short-term impact on luxury sales. I don't think LVMH really thinks in two- and three-year timeframes. The two more that I have in the bear case is despite buying 75 brands, there still isn't one that is as good as the original brand in the portfolio, Louis Vuitton. The fact that that is responsible for a quarter of all revenue and still makes the product that is the best business, I mean fashion and leather goods is 50% of all of LVMH, but half of fashion leather goods is Louis Vuitton, that's not exactly a bear case on the business, but it is interesting to observe. Power laws are a thing.…

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