Rolex and Cartier Climb Luxury Ranks as Fashion Houses Falter, Morgan Stanley Reports

A potential shift is underway in the global luxury market, with 'hard luxury' brands like Rolex and Cartier gaining significant ground on traditional fashion and leather goods leaders, according to new estimates from Morgan Stanley. While Louis Vuitton held its position as the world's largest luxury brand by turnover in 2025, its declining sales stood in sharp contrast to the strong growth posted by top-tier watch and jewelry makers.

A Shake-Up at the Top

Louis Vuitton remained the industry leader with an estimated €20.8 billion in turnover for 2025, though this marked a second consecutive annual sales decline, falling approximately 6%, the report stated. The brand's EBIT was also estimated to have dropped by 13% to €9.5 billion. Meanwhile, key competitors are closing in:

• Chanel held the number two spot with an estimated €16.2 billion in turnover. Morgan Stanley noted its retail sales are now nearly equal to Louis Vuitton's, suggesting it could overtake its rival as soon as 2026.
• Rolex climbed to fourth place, surpassing Dior, with turnover growing by about 5% to €11.7 billion, driven by higher average selling prices.
• Dior slipped to fifth place after its turnover fell 9% to €11.2 billion, its second straight year of declines.
• Hermès proved resilient, holding third place with a 5.5% increase in brand turnover to €15.7 billion.

Jewelry and Watches Shine

The report highlights a clear divergence in performance between soft luxury (fashion, leather goods) and hard luxury (jewelry, watches). Cartier, a Richemont-owned brand, was a standout performer, with its turnover rising 8% to €11.0 billion. Morgan Stanley analysts believe Cartier is on course to overtake Dior if its current growth momentum continues.

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Similarly, Van Cleef & Arpels, another Richemont maison, ranked ninth and was one of the fastest-growing brands in the top 10, with sales climbing an estimated 10%. Rolex's ascent was also notable, with its share of the Swiss watch market by retail value rising to an estimated 33% in 2025 from 26% in 2019, according to the bank.

Headwinds for Soft Luxury

In contrast to the gains in hard luxury, several major fashion houses faced significant challenges. Gucci, owned by Kering, recorded the steepest decline among the top 10 brands. Morgan Stanley estimated its turnover plunged 22% to €6.0 billion in 2025 amid a prolonged brand reset.

Other major brands also saw sales contract. In addition to the declines at Louis Vuitton and Dior, LVMH-owned Tiffany & Co. saw its estimated turnover dip 3% to €4.9 billion. The trend suggests that consumer appetite may be shifting toward investment-grade timepieces and jewelry over apparel and accessories.