Selective RetailingNarrow moat

LVMH (MC) — moat facet

A retailer inside a luxury group: Sephora earns the margin, DFS is being sold.

Selective Retailing is the group's second-largest revenue line and a different kind of business. It brought in €18,348 million in 2025 and €1,780 million of profit from recurring operations, a margin of about 9.7%.12

Selective Retailing revenue (€bn)€12.0bn2016€13.3bn2017€13.6bn2018€14.8bn2019€10.2bn2020€11.8bn2021€14.9bn2022€17.9bn2023€18.3bn2024€18.3bn2025LVMH annual results releases 2017-2025 and 2023 URD
A 31% fall in 2020 when travellers vanished; back above 2019 by 2022.

It holds Sephora, which had 2,175 stores in 34 countries at the end of 2024, plus DFS in travel retail and Le Bon Marché in Paris.3 Sephora sells other companies' brands as well as LVMH's, so this group competes on range and service rather than scarcity. The United States was 46% of its 2024 revenue.4

It has grown more slowly than the rest of LVMH. Revenue was €11,973 million in 2016, about 4.9% a year to 2025.56 It collapsed in 2020, down 31%, and lost €203 million, largely because DFS depends on travellers.7 It passed its 2019 revenue in 2022 and reached €17,885 million in 2023.8

Profit has recovered faster than revenue. The margin was 7.7% in 2016, 5.3% in 2022 and 9.7% in 2025, when profit rose 28%.9101112 Revenue grew 4% organically in 2025, and LVMH says Sephora grew in both revenue and profit and consolidated its world leadership in beauty retail.13

The travel half is being cut back. DFS sold its businesses in Greater China to China Tourism Group Duty Free and agreed to sell its Los Angeles and San Francisco airport concessions and DFS Okinawa.14 Asia outside Japan fell from 16% of the group's revenue in 2022 to 12% in 2024.15

The first half of 2026 was the steadiest of any group. Revenue was €8,406 million, down 2% reported and up 5% organically, with 6% in the second quarter, and profit rose 2% to €893 million.16

The verdict is that this group is a well-run retailer that happens to sit inside a luxury company, and its value is diversification rather than pricing power. The measure is its margin: 9.7% in 2025 is the best since 2018's 10.1%, and a return toward 5% would mean the DFS disposals have not removed the weak half.

Moat trajectory: Widening

Margin up to 9.7% in 2025 and profit up again in H1 2026 while DFS shrinks.

The number that tests this moat
Moat Explorer calc
Selective Retailing recurring operating margin
About 9.7% in 2025, from 7.6%

The best since 2018; a fall back toward 5% would mean the DFS disposals did not remove the weak half.

How it's calculated: 1,780 / 18,348 against 1,385 / 18,262.
Source: LVMH FY2025 results release (Moat Explorer calc) ↗
References
  1. ReportedIt brought in €18,348 million in 2025 and €1,780 million of profit from recurring operations, a margin of about 9.7%.
    LVMH 2025 annual results release - revenue by business group with organic change, profit from recurring operations by business group, and business-group commentary, 2024 and 2025 — FY2024-FY2025 · publ. January 2026 · source ↗
  2. Moat Explorer calcIt brought in €18,348 million in 2025 and €1,780 million of profit from recurring operations, a margin of about 9.7%.
    Moat Explorer calculation from LVMH's annual results releases 2017-2025, the 2023 and 2024 URDs and the H1 2026 release: operating margins, shares of group profit and revenue, compound growth rates — FY2016 to H1 2026 · publ. 2026-09-23 · source ↗
  3. ReportedIt holds Sephora, which had 2,175 stores in 34 countries at the end of 2024, plus DFS in travel retail and Le Bon Marché in Paris.
    LVMH 2024 Universal Registration Document - business-group sections: revenue, profit, operating margin, revenue by region, type of revenue, store networks, Wines & Spirits revenue split and volumes, Diageo joint ventures, organic change by business group — FY2022-FY2024 · publ. March 2025 · source ↗
  4. ReportedThe United States was 46% of its 2024 revenue.
    LVMH 2024 Universal Registration Document - business-group sections: revenue, profit, operating margin, revenue by region, type of revenue, store networks, Wines & Spirits revenue split and volumes, Diageo joint ventures, organic change by business group — FY2022-FY2024 · publ. March 2025 · source ↗
  5. ReportedRevenue was €11,973 million in 2016, about 4.9% a year to 2025.
    LVMH 2017 annual results release - revenue and profit from recurring operations by business group, 2016 and 2017 — FY2016-FY2017 · publ. January 2018 · source ↗
  6. Moat Explorer calcRevenue was €11,973 million in 2016, about 4.9% a year to 2025.
    Moat Explorer calculation from LVMH's annual results releases 2017-2025, the 2023 and 2024 URDs and the H1 2026 release: operating margins, shares of group profit and revenue, compound growth rates — FY2016 to H1 2026 · publ. 2026-09-23 · source ↗
  7. ReportedIt collapsed in 2020, down 31%, and lost €203 million, largely because DFS depends on travellers.
    LVMH 2020 annual results release - revenue by business group with organic change for the year and the fourth quarter, and profit from recurring operations by business group, 2019 and 2020 — FY2019-FY2020 · publ. January 2021 · source ↗
  8. ReportedIt passed its 2019 revenue in 2022 and reached €17,885 million in 2023.
    LVMH 2023 Universal Registration Document - revenue and profit from recurring operations by business group, 2021-2023 — FY2021-FY2023 · publ. March 2024 · source ↗
  9. ReportedThe margin was 7.7% in 2016, 5.3% in 2022 and 9.7% in 2025, when profit rose 28%.
    LVMH 2017 annual results release - revenue and profit from recurring operations by business group, 2016 and 2017 — FY2016-FY2017 · publ. January 2018 · source ↗
  10. ReportedThe margin was 7.7% in 2016, 5.3% in 2022 and 9.7% in 2025, when profit rose 28%.
    LVMH 2024 Universal Registration Document - business-group sections: revenue, profit, operating margin, revenue by region, type of revenue, store networks, Wines & Spirits revenue split and volumes, Diageo joint ventures, organic change by business group — FY2022-FY2024 · publ. March 2025 · source ↗
  11. ReportedThe margin was 7.7% in 2016, 5.3% in 2022 and 9.7% in 2025, when profit rose 28%.
    LVMH 2025 annual results release - revenue by business group with organic change, profit from recurring operations by business group, and business-group commentary, 2024 and 2025 — FY2024-FY2025 · publ. January 2026 · source ↗
  12. Moat Explorer calcThe margin was 7.7% in 2016, 5.3% in 2022 and 9.7% in 2025, when profit rose 28%.
    Moat Explorer calculation from LVMH's annual results releases 2017-2025, the 2023 and 2024 URDs and the H1 2026 release: operating margins, shares of group profit and revenue, compound growth rates — FY2016 to H1 2026 · publ. 2026-09-23 · source ↗
  13. ReportedRevenue grew 4% organically in 2025, and LVMH says Sephora grew in both revenue and profit and consolidated its world leadership in beauty retail.
    LVMH 2025 annual results release - revenue by business group with organic change, profit from recurring operations by business group, and business-group commentary, 2024 and 2025 — FY2024-FY2025 · publ. January 2026 · source ↗
  14. ReportedDFS sold its businesses in Greater China to China Tourism Group Duty Free and agreed to sell its Los Angeles and San Francisco airport concessions and DFS Okinawa.
    LVMH first-half 2026 results release - revenue by business group with organic change for the half and the second quarter, profit from recurring operations by business group, and business-group commentary — H1 2026 · publ. 27 July 2026 · source ↗
  15. ReportedAsia outside Japan fell from 16% of the group's revenue in 2022 to 12% in 2024.
    LVMH 2024 Universal Registration Document - business-group sections: revenue, profit, operating margin, revenue by region, type of revenue, store networks, Wines & Spirits revenue split and volumes, Diageo joint ventures, organic change by business group — FY2022-FY2024 · publ. March 2025 · source ↗
  16. ReportedRevenue was €8,406 million, down 2% reported and up 5% organically, with 6% in the second quarter, and profit rose 2% to €893 million.
    LVMH first-half 2026 results release - revenue by business group with organic change for the half and the second quarter, profit from recurring operations by business group, and business-group commentary — H1 2026 · publ. 27 July 2026 · source ↗
Sources
Generated September 23, 2026