LVMH’s Drinks Division Returns to Growth

LVMH said on Thursday that its wine and spirits division returned to growth in the first quarter of 2026, a sign that demand for premium drinks is stabilizing after a difficult end to last year, even as weakness in the United States and uncertainty around cognac continue to weigh on the business.

Moët Hennessy, the drinks arm of the French luxury group, reported organic revenue growth of 5% to €1.27 billion in the three months through March. Reported revenue fell 2%, reflecting currency effects and accounting items. The company had posted a 9% organic decline in the fourth quarter of 2025 and a 5% drop for the full year, making the latest quarter an important reversal, though not yet a full recovery.

Champagne and wines were the main source of improvement. That segment rose 5% on an organic basis to €663 million, helped by what LVMH described as a good start to the year in Europe, where consumption patterns have begun to normalize after a softer period. The company also pointed to continued strength in Provence rosé wines, which have remained popular with consumers seeking lighter wine styles.

Asia was the strongest region in the quarter, with sales excluding Japan up 7%. LVMH said the timing of Chinese New Year helped lift demand and gifting activity, especially for Champagne and other celebratory products. The holiday fell at a more favorable point in 2026 than it did a year earlier, giving the company an added boost in one of its most important markets.

The picture was less encouraging in the United States. LVMH said overall sales there rose 3%, but demand for wines and spirits remained soft. Cécile Cabanis, the company’s chief financial officer, said part of the first-quarter improvement came from shipment timing rather than stronger underlying demand, warning that this support may not continue into the second quarter.

Cognac remains one of the division’s biggest concerns. LVMH said shipments helped first-quarter results, but it does not expect that effect to last. The category continues to face weaker demand in key markets, especially the U.S., along with broader pressure on premium spirits as consumers remain cautious.

At the group level, LVMH reported organic growth of 1%, while reported revenue fell 6% to €19 billion. The company cited currency swings and a difficult global backdrop. It also pointed to geopolitical tensions, including those tied to the Middle East, as part of a still uncertain outlook for the rest of the year.

For now, LVMH is leaning on innovation, brand strength and selective distribution as it tries to protect margins and support demand across its drinks portfolio. The first quarter suggests that premium wine and spirits are holding up better than they were late last year, but the recovery is uneven and still depends heavily on region and category.