LVMH Pursues Armani While Bracing for Market Headwinds and Legal Setbacks

Despite a 29% stock drop and weak demand, LVMH quietly positions for up to 70% stake in Armani, following founder's testament and a rare Louis Vuitton trademark loss.

LVMH shares are trading near 454 euros, down roughly 29% since the start of the year, as the luxury giant contends with weakening demand, geopolitical friction, and a rare legal defeat for its flagship brand Louis Vuitton. Yet beneath the surface of the stock’s slide, the Paris-based group is quietly positioning itself for what could be one of the most consequential moves in recent luxury history: a controlling stake in Giorgio Armani.

The foundation for that deal was laid last September, when Giorgio Armani passed away, and his testament set the wheels in motion. Within 12 to 18 months, an initial 15% stake in the Milanese fashion house must be sold. The founder named LVMH, along with longtime license partners L’Oréal and EssilorLuxottica, as preferred buyers. Italian media reports suggest the Armani leadership is weighing a three-way split of the package, giving LVMH a 5% toehold to start. The strategic blueprint, however, extends far beyond that: the goal is for LVMH’s stake to climb to nearly 70% within five years.

That ambition arrives at a moment when LVMH’s operational strength is being tested. First-quarter 2026 revenue fell 6% year-on-year to 19.1 billion euros, hurt by currency effects and tensions in the Middle East. The stock closed the week at roughly 454 euros, just above its yearly low, and remains 17.3% below its 200-day moving average. Analysts still see upside, with a consensus target near 601 euros, but the near-term mood is cautious.

Adding to the pressure, Louis Vuitton lost a trademark dispute in Portugal against Licores do Vale, a small liqueur producer. The court allowed the firm to keep using its “LV” initials on its labels. Financially the case is negligible, but for a company that guards its brand equity fiercely, the symbolic sting is real. It underscores the limits of even the most aggressive intellectual property strategy.

The Armani opportunity, if realised, would give LVMH a fresh growth vector at a time when its core markets are faltering. Slower Chinese demand, weaker European tourism flows, and the Middle East drag are all weighing on investor confidence. The group’s management has responded by sticking to its long-term playbook — maintaining pricing power, running share buybacks, and accelerating sustainability targets. Internal climate goals for 2026 have already been exceeded, with greenhouse gas emissions halved.

Meanwhile, the countdown in Milan has begun. Armani CEO Giuseppe Marsocci is preparing the five-year business plan and will soon appoint advisors for the sale process. Once they present the concept to potential buyers, the official race for one of the last independent luxury houses will be under way. For LVMH, that race offers a strategic prize that no single quarter’s revenue decline can diminish.