Essilor Luxottica Q3 results solid 4% Growth

EssilorLuxottica has announced consolidated revenue for the third quarter of 2024 reached Euro 6,437 million, representing a year-on-year increase of 4.0% at constant exchange rates1 compared to the third quarter of 2023

• Group’s revenue up 4.0% at constant exchange rates1 in Q3, +4.9% year to date
• Revenue positive in both segments in all the regions in Q3
• North America up low-single digit, with sun retail turning positive at the end of the quarter
• EMEA up mid-single digit, driven by both Professional Solutions and Direct to Consumer
• China kept positive, despite macroeconomic headwinds, supported by Stellest 40% growth
• Ray-Ban Meta and Transitions Gen S key growth pillars, both awarded at SILMO Paris 2024
• EssilorLuxottica among top-50 Companies in the Fortune’s ‘Change the World’ list

0. Francesco Milleri, Chairman and CEO, and Paul du Saillant, Deputy CEO at EssilorLuxottica commented: “In the third quarter, we maintained solid momentum, with all regions and businesses contributing to steady growth, fueled by our commitment to innovation and excellence. We solidified our positioning in the med-tech space, while preparing for the acceleration of the business in the near future, with our myopia management offering and smart glasses roll-out, Nuance Audio launch, Heidelberg Engineering and Supreme additions to the Group’s portfolio. The long-term partnership between EssilorLuxottica and Meta continues to write the bold story of smart glasses as the disruptive category in digital eyewear. Welcoming 1,000 new talented colleagues from the acquired companies strengthens our collective expertise. We’re also proud to be once again recognized as one of the top–50 companies on Fortune’s ‘Change the World’ list. As we enter the fourth quarter with confidence, we remain on track with our long-term targets and continue driving meaningful transformation for the years to come.

2. Highlights

   The third quarter of the year delivered nice growth of the top line, with all the regions and channels on a positive trend. The traditional eyecare/eyewear business advanced nicely, overall close to the Group’s target pace, with EMEA and most of the emerging markets at the forefront. Innovations gave a material additional contribution, with Stellest and Ray-Ban Meta both growing fast. And with the upcoming launch of Nuance Audio another breakthrough innovation is already on the horizon. 

   

   Professional Solutions

   Professional Solutions recorded revenue of Euro 3,017 million, up 3.4% compared to the third quarter of 2023 (+1.3% at current exchange rates).All regions were positive in the quarter. North America and Latin America followed a broadly similar trajectory compared to previous quarters. On the other hand, EMEA slightly decelerated from the first half and the performance in Asia-Pacific was affected by weakening macroeconomic conditions across Greater China. Innovation continued to be the growth engine in the lens category, with Varilux XR, Transitions Gen S and Stellest standing out. Ray-Ban Meta wearables kept performing strongly.

   Direct to Consumer

   Direct to Consumer registered revenue of Euro 3,420 million, up 4.6% compared to the third quarter of 2023 (+3.2% at current exchange rates). All regions contributed to growth in the quarter, with the Group progressing broadly in line with the first half of the year, above +4% in terms of comparable-store sales2. North America confirmed the positive trend in optical, while sun kept negative in the quarter but turned positive in September. EMEA rose mid-single digit, with optical banners continuing to progress nicely and the sun business back to healthy growth. Latin America accelerated on the back of the sun business, while Asia-Pacific was aligned to the slightly positive pace of the first half. E-commerce grew at the same pace as the whole Group, with EMEA being the best performing region. 

   

   North America

   North America posted revenue of Euro 2,854 million, up 1.6% compared to the third quarter of 2023 (+0.5% at current exchange rates), in line with the trajectory of the first half. In Professional Solutions, the eyewear business was sustained by the solid growth of the prescription frames but hampered by the negative performance of the sunglasses category as a reflection of the overall uncertain macroeconomic backdrop. Ray-Ban Meta wearables continued to excite and represented one of the strongest drivers of the quarter. On lenses, the new generation technologies once again bolstered the growth of their respective families with Varilux XR and Transitions Gen S gaining further momentum. Trends in the key accounts and partner ECPs remained healthy, while the non-partner independent channel kept facing some pressures. In Direct to Consumer, the optical banners marched at a similar pace to the first half of the year still relying on the solid demand of the insured customer driven by a further boost in exam capacity and conversion. The performance at Sunglass Hut was still negative but showed some initial signs of improvement in the month of September. E-commerce sales started to regain momentum underpinned by the success of Ray-Ban Meta on Ray-Ban.com.

   EMEA

   EMEA posted revenue of Euro 2,433 million, up 5.6% compared to the third quarter of 2023 (+5.0% at current exchange rates), slightly decelerating from the first half. The performance in Professional Solutions was bolstered by the growth of most of the key countries, with all product categories on the rise. The lens business once again successfully leveraged innovation to fuel its growth. Varilux XR continued to have a visible impact despite the passing of its launch anniversary, while Transitions Gen S was rolled out in additional geographies. The Nikon brand also delivered an excellent quarter. Miu Miu, Oakley and Jimmy Choo were the top contributing frame brands and the Ray-Ban Meta wearables kept attracting attention. In Direct to Consumer, both optical and sun supported the healthy results. The elevation of the consumer journey in the optical banners progressed successfully. The increased availability of EssilorLuxottica products in the store continued to resonate well with consumers and the optical subscription program gained further traction. The sun business strongly recovered following the weather-related slowdown of the second quarter

   

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Long-Term Outlook

The Company confirms its target of mid-single-digit annual revenue growth from 2022 to 2026 at constant exchange rates1 (based on 2021 pro forma3 revenue), targeting a range of Euro 27-28 billion, and expects to achieve an adjusted4 operating profit as a percentage of revenue in the range of 19-20% by the end of that period.