Inside the Dubai Mall shopping center, Dubai (United Arab Emirates), March 5, 2026. GIUSEPPE CACACE/AFP
The war in Iran shattered the hopes of luxury goods manufacturers in 2026. All were counting on growth in sales in the Middle East and Southeast Asia, as the Chinese market continued to struggle to recover from the crisis that began in 2024. But the conflict launched by the United States and Israel on February 28 emptied shopping malls in the United Arab Emirates, jeopardized duty-free sales at airports, complicated air links to and from Southeast Asia and increased economic uncertainty in Europe.
On January 27, while presenting its 2025 annual results, which showed a 5% drop in activity, LVMH emphasized how "the Middle East continued to post very strong growth." Three months later, the French group, which makes 6% of its global sales in the Gulf region, estimated that the war in Iran cost it one percentage point of growth in the first quarter.
The world's largest luxury group reported a 6% drop in published sales and a 1% increase at constant exchange rates for the first three months of 2026, according to its quarterly report released Monday, April 13. The group, owner of Louis Vuitton, Dior and Sephora, saw its sales plunge by around 50% in the Middle East in March. When the stock market opened on Tuesday, LVMH shares were down 1.66%.
