As affluent consumer spending in the United States revives, expectations are growing that the luxury industry will enter a full-fledged recovery phase this year. Last year, the industry endured a harsh adjustment period as sales were effectively flat.
According to the Financial Times (FT), global investment banks predicted that the luxury sector will regain a single-digit growth rate this year. Barclays and HSBC forecast growth of 5%–6% and 6.5%, respectively, and said U.S. consumers would take the lead.
Carol Majew at Barclays analyzed that the bull market on the New York Stock Exchange is highly likely to translate into increased luxury spending. Majew said, "Last year, uncertainty, including U.S. President Donald Trump's tariff policy, disrupted consumer sentiment," adding, "This gap is gradually closing, and political variables are having less influence on so-called 'feel-good consumption.'"
In fact, the U.S. market is already propping up the results of major luxury groups. For example, Swiss luxury group Richemont posted €1.74 billion (about 2.9791 trillion won) in fourth-quarter sales in the Americas, up 14% on-year, driven by U.S. demand for jewelry brands such as Cartier and Van Cleef & Arpels. HSBC expects the growth rate of luxury sales in the United States to jump from 2% last year to as high as 8% this year.
Changes in brand strategy are also drawing attention. After sharp price hikes during the COVID-19 pandemic, luxury houses slowed the pace of increases in 2025 and moved to refresh their offerings by appointing new creative directors and reorganizing product lineups. Notable examples include Jonathan Anderson, who joined Dior from Loewe, and Matthieu Blazy, who moved to Chanel from Bottega Veneta.
Investors are also focusing on the effects of expense cuts and business restructuring. Earlier, LVMH sold its travel retail business in China, and Richemont streamlined by winding down watch brand Baume & Mercier to pivot toward core operations. The expectation is that such portfolio reshaping will lead to medium- to long-term profitability improvements.
HSBC cited volume-led growth, rather than price increases, as the hallmark of this recovery cycle. According to consulting firm Bain, prices for luxury apparel, bags and shoes are currently 1.5 to 1.7 times their 2019 levels, leaving limited room for further increases.
In practice, luxury brands are seeking a leap by putting forward lower-priced items in the €1,000–€2,000 range. Recently, Louis Vuitton placed a roughly €1,500 (about 2.56 million won) monogram bag front and center in an ad campaign, deploying an iconic product with less of a price burden than new releases to draw in consumers.
However, the fact that the U.S. economy is hardening into a "K-shaped" structure, in which spending power diverges clearly based on asset ownership, appears to be a variable. While spending by high-income earners with assets is solid, some note that if the "aspirational consumption" of middle- and lower-income groups with relatively less room does not recover, there will inevitably be limits to broadening the market base. Another task for brands is to win back middle-class customers who left after years of price increases.
Even so, the industry is maintaining an optimistic stance for now. Erwann Rambourg, global head of luxury at HSBC, said, "The fact that growth is reappearing through higher volumes rather than prices is a clear sign the luxury industry is coming back," adding, "What matters most is that consumers are finding reasons to return to stores."