LVMH becomes the first European company to surpass $500B in market value
cnbc.com
cnbc.com
It looks like their branding is working, if people think this!
(The same is actually true of an iPhone as well but there are more stats and specs around it)
What's easier to develop:
a handbag/sunglasses/perfume/linen/fabric based clothing or R&D on microprocessors to make the world's leading smartphone in terms of innovation, fit + finish, etc.?
Some of this R&D also happens in Europe even if the parent company or ultimate manufacturer is American.
Developing microprocessors has KPI's. Developing clothing doesn't. The first is technical, the second is social.
Pointing to the apple example, which Steve was more important? The technical one or the social one?
I am extremely interested in stats like:
what percentage of LVMH customers/buyers should be purchasing their products at all from a financial-wellness perspective?
How are they so successful at selling the allure of "our products send a positive message of wealth + status in society"?
Why do people (who common don't actually have wealth of any kind) find themselves victim/attracted to this marketing message?
Why do people watch tv or movies, or read and post comments on HN? There are very clearly better things to be doing with your time and life. In the end it makes someone feel good for however long.
There are of course good points above in that the iPhone has significantly more functional utility over replacement than a luxury handbag or luxury spirits (I would argue that some of LVMH's cosmetics products such as those from Sephora or Fenty actually do provide differentiated utility).
Another side of this is that these luxury retail companies are not run by a bunch of silly, unsophisticated people. They have absolutely savage businesspeople at the helm, and they run very sophisticated logistics in addition to the fluffier branding (which I'd argue isn't even fluffy, they are literally the best in the world).
they help poorer people transfer their wealth to Bernard Arnault (who is already worth $240b+)
It's a certain cult of personality that Jobs had and utilizing very suddle things. to great effect. Jobs had miticulous detail when designing thee User interface, font system, layout and every single workflow in the original mac. When they made the Ipod, they used white headphones. Everyone else used black, as that's the natural color of the polimer. These white headphones showed everyone around you that you had an Ipod and was a huge driver of sales. The mac logo is upside down to the user, but rightside up to anyone looking at you on your computer.
Everything was crafted around ease of use, and have always been on the higher end of the market than the market thought possible.
Elon thinks, acts, walks and talks very much like Jobs. i'm sure it's through studied effort, but Tesla has the same brand recognition as early apple did.
Without one of them, Apple wouldn't exist today. Without the other one, Apple would have never existed at all!
Not a fan of enormously big companies, but at least the U.S. has the likes of Amazon, Tesla, and Microsoft offering much utility.
LVMH, on the other hand, is Europe’s most valuable company? What a sore lack of innovation…I’m not even surprised because it’s from the continent that still has a lot of kings and queens (albeit ceremonial)…still doesn’t change my mind because I believe royals are the biggest grifters on earth.
You have to admit, if you told someone in 1923 that 100 years from now, by far the most relevant technology companies will all American or Asian, they’d be a bit surprised.
If you told them that the war which ended five years previously would be repeated, except with greater destructive capability, resulting in the flattening of much of Europe leaving tens of millions of its citizens dead or displaced, while at the same time the Washington Naval Treaty being signed in 1923 ultimately failed to contain the Japanese entering the technological arms race, they might be less surprised about that outcome.
(because I checked: several of the ships involved in Pearl Harbor on both sides were either in service or under construction in 1923)
I'd be very much interested to see if it's possible to compare the wealth gap and the lifestyle gap between the US and Europe to see what its peaks and troughs are over time. It was probably at its widest during the Eisenhower administration.
"Hitting the ground running" with a own launch in Europe is almost impossible due to lack of structural support, investor-mindset and language/market differences. I believe a stronger unification would be needed, but unfortunately there's no sign of improvement, as like in US the political trend in EU is for countries to become MORE nationalist instead of embracing a European Union...
There are examples of European technological leadership (e.g Dutch ASML) but they are scarce. Many other powerhouse regions (e.g Northern Italy) that used to be important innovators have been hollowed. In critical areas such as the green energy transition (which is a top-priority goal of the EU) the EU as a whole is a net importer from China.
https://ec.europa.eu/eurostat/statistics-explained/index.php...
Europe produces far more that is of importable and exportable economic importance.
If you want to talk about a lack of growth and an ageing population combined with supposed lagging economic dynamism, then call Europe Japan, that would make sense with what you are trying (but sadly failing...) to say, but I guess it wouldn't be as inflammatory.
Europe is similar to Japan in that it’s full of American military bases. Essentially occupied/conquered land.
Europe is dying and will never be a leader again. Like Argentina. But with castles.
But for what it's worth, yes, Europe will never again be as influential as it was 150 years ago. But the US will never again be as influential as it was 30 years ago, or even five years ago, either. Plus ça change!
Innovation is not only the latest js platform or the latest tiktok clone launched
French top 4 are:
- lvmh $496b
- Loreal $256b
- Hermes $232b
- Dior $172b
https://companiesmarketcap.com/france/largest-companies-in-f...
#9 is EssilorLuxottica (sunglasses), and #11 is a clothing brand.
If this sort of Fashion ever goes out of style does that whole country go bankrupt? I fear what the unstoppable and inevitable ascendance of Balenciaga might do to the French.
I wonder to what extent the list you link to is affected by French companies moving their headquarters to the Netherlands (or sometimes Luxembourg). Either directly, or while merging with other European companies...
Netherlands are a little bit like the European Delaware in that regard... And would you exclude Delaware corps when looking at New York or California?
> I wonder to what extent the list you link to is affected by French companies moving their headquarters to the Netherlands (or sometimes Luxembourg). Either directly, or while merging with other European companies...
Well, cross reference the lists and you tell me.
https://companiesmarketcap.com/netherlands/largest-companies...
Stellantis, Airbus, anyone else?
- ASML. $250.35 B
- Prosus. $152.47 B
- Airbus. $109.20 B
- Heineken $65.26 B
Never heard of Prosus, but that's apparently a tech investment group.
ASML is of course a real tech innovator. I'm surprised to see Airbus listed as a Dutch company; isn't their HQ in France? Heineken is beer of course. Not terribly innovative, but a lot of people seem to like it anyway.
(from Wikipedia)
Very surprised by that, I thought it was mostly French with some European contributions.
Don’t blame the Dutch (ASML), Swiss (Novo Nordisk), Germans (SAP), etc.
France has its fair share of large industrial companies by the way.
What? What about Airbus (not fully French of course), Stellantis, Renault, Faurecia, OVH, Scaleway, STMicro, Doctolib? Just because what markets valuate luxury goods the most doesn't invalidate the existence and innovation of other sectors.
Tesla is (in)famously overvalued. Their market cap is higher than most other car manufacturers (pumping out many times more vehicles than Tesla is), most of whom have caught up on EVs (is Toyota the only big manufacturer still lagging on EVs? I think they are). It's purely the brand of their CEO which is of course floundering because he's incapable of keeping his mouth shut and first comer advantage, and both of those are disappearing fast.
Microsoft, Apple, Amazon, Google have real utility, true, and they're huge, all across the world.
> What a sore lack of innovation
That's the wrong way of looking at things IMO. Just because the biggest companies are old and in non-tech niches doesn't mean there's no innovation. You can't seriously claim that companies such as VW Group, Stellantis, Airbus don't innovate? Let alone the smaller star/scale-ups (just a few French examples: BackMarket, Doctolib, Ornikar). There's plenty of innovation, it just isn't what's best valued and highest earning. A French innovating startup first has to capture the French market, then expand to neighbouring countries (of course that means legal and translating challenges at the very least) to be able to become big enough for those huge valuations. An American one is starting with a much bigger market to be able to capture, so of course a French innovator will be lagging in terms of global market share and valuation; that doesn't make them any less innovative though.
As a small example, Doctolib have practically revolutionised doctor's appointments in France and are exporting the model to other countries. Innovating in the healthcare space is very difficult due to a variety of reasons (highly sensitive data, lots of incumbents, doctors don't necessarily want to have any tech involved any more than necessary) but they did it with great tech.
Due to the reduction in CO2, NOx and SOx, it is estimated that Tesla has prevented over 100,000 premature deaths.
OTOH, Google & Meta are advertising companies. I question their utility to the world.
VW Group has had a 5 year maximum P/E ratio of 20.69; for Stellantis it's 4.11 (but they're less than 2 years old). True that Tesla is seeing some very good revenue growth, 51% for 2022 compared to 2021. But that revenue is at $86 billion, meanwhile VW Group are at $307 billion. It is flat out ridiculous how overpriced Tesla are, nothing justifies them having a higher market cap than say VW Group.
TSLA is still overhyped, but I would never invest in VW, unless the stock takes a massive dive, or they spin out Porsche.
Like, if they stopped selling cars today they would theoretically recoup all of that debt once all the cars they've sold have been fully paid off via financing.
Does the math include the deaths from Tesla selling the permission to pollute to other carmakers? https://www.cnbc.com/2021/05/18/tesla-electric-vehicle-regul...
True, advertising is a huge part of Google and Facebook. However they are so ubiquitous and embedded in our lives via the the Google search engine, WhatsApp, Instagram, YouTube... that you seem to only remember the unpleasant side which is advertising.
Haven't you run thousands of Google searches by now? Sent thousands of WhatsApp messages (i) ? Seen thousands of YouTube videos? Surely that has given you tremendous utility. You may argue that you find the the way Facebook/Google are making money as unattractive, but surely these companies have provided net positive utility to you and the world?
They are also some lovely open source projects that have come out of these companies that are being used by the next wave of startups!
(i) In some countries WhatApps is not dominant so this may not describe you.
Doctolib have been massive since well before the current government came into power, so what the hell are you blaming them for? The contract for Covid vaccine appointments? If that's the first time you heard of them, you're not representative of the French population at large. And yes, it absolutely made sense to give a contract to a company that can deliver now (with hiccups at the beginning) instead of wasting time on developing something from scratch.
Yes, many doctors don't have assistants nowadays, which makes the experience better for 90%+ of the population and saves on admin costs. The UX of a few clicks in an app (where you can differentiate doctors of course) is much better than calling, waiting for someone to pick up, and then negotiating dates while they're pressed. Also, doctors' offices (where there are a few doctors sharing space) usually still have assistants, as do clinics and the like, so for those that can't use an app there are still alternatives.
As for the public IT systems, you have got to be kidding. I came to France in 2012, and I can tell you that in the last 10 years there have been massive improvements in public IT. Most of it is actually good and usable - France Connect, ANTS, Impots, Ameli, etc. are a breeze. You can schedule appointments, do administrative stuff (like order new documents, submit tax info) quite easily and accessibly.
Urssaf's website for autoentrepreneurs could be better though.
Ah, the good old "the current government is destroying public services". Which services, exactly? Ameli's budget has been steadily increasing every year under the current government, since well before the pandemic. With less than what they ask for, but still increasing.
and guess what ? theres a reason our gdp per ppp did not move from 2008 while other countries got wealthier. our wealth got distributed to shareholders of companies like doctolib so that you can praise how good it is to book online a random doctor - again with no way to get feedback or review from patient like in the us system for instance - then struggle even more to get a first appointment because doctors dont take new patients and now that everything is digital you cant even go there or call to discuss your case.
i reckon its better for you as a foreigner that did not live in france to see how it was before. 10 years in france and,you know already what is best for 90% of its people, you either shareholder of doctolib or linked to the gov. every IT person at ameli would tell you they ve been gutted, their data scrapped by doctolib . doctolib only exist because massive money went in so that private shareholder can get wealthy using french citizen health data and you see it as progress?
That's a very big stretch and also false. Macron was only appointed as minister of Finance in 2014, 3 years into Hollande's term, and it only happened because Hollande's initial financial and economic policies were turning out to be disastrous so a change was needed.
> and guess what ? theres a reason our gdp per ppp did not move from 2008 while other countries got wealthier. our wealth got distributed to shareholders
I think you need to update your talking points, GDP PPP has been going up (Covid being an exception) since the Macron years:
https://www.worldeconomics.com/GrossDomesticProduct/Real-GDP...
> then struggle even more to get a first appointment because doctors dont take new patients and now that everything is digital you cant even go there or call to discuss your case
You're confusing problems. There not being enough doctors and them not taking in new patients had nothing to do with "digital" or not. It's just that with "digital" you can actually know in advance when you can get a meeting with which doctor instead of having to make the rounds calling or visiting all doctors in your area. You cannot seriously tell me that this is a bad thing. And again, clinics and cabinets of multiple doctors still have assistants that you can call or visit to talk to if you prefer a slower and suboptimal way of doing things.
> reckon its better for you as a foreigner that did not live in france to see how it was before
When I arrived, universally all public IT systems were just shit. Like from a bad movie, designed by people who hadn't come close to computers, and written by people who won't use them and couldn't care any less. Again, ANTS, Impôts, Ameli, all those are new(or renewed) and with seamless making it easy to do basic administrative stuff without having to get an appointment at an office that only works 10-11:30 on Tuesdays on the third week of months, on a website that falls down every time there are more than 5 people on it (that was the case with my prefecture).
> doctolib only exist because massive money went in so that private shareholder can get wealthy using french citizen health data
They're not "using french citizen data", they're providing a service that uses it. Also, you keep saying "shareholders getting wealthier".. you know that Doctolib is private and thus we don't know about their financials and it's "shareholders", which btw includes Bpifrance (state investment bank), aren't wealthier for it?
> Their market cap is higher than most other car manufacturers (pumping out many times more vehicles than Tesla is), most of whom have caught up on EVs (is Toyota the only big manufacturer still lagging on EVs? I think they are)
Tesla is a top 5 car manufacturer by earnings at $14B for 2022. Toyota is next up that list at earnings of $20B.
Tesla sell almost 0.5 million EVs a quarter and has a 60% EV market share in the US, it sells more than everybody else combined currently, and is growing very fast. Hard to know how it will all shake out but so far nobody has caught up. Doesn't mean they can't but they are chasing. EV share of the US market is only 7% but is clearly the future, and again, Tesla has 60% (!) share in that market segment.
Looking forward there is the Gigafactory in Mexico and the Cybertruck release. If that is a hit Tesla will maintain its market leader position in 2024 and surpass Toyota in earnings. And they keep dropping prices. With smaller earnings than Tesla, and no institutional knowledge of making EVs it is hard to come up with a reason how and why Toyota can end up with a larger share of the EV market - suddenly they will find themselves in the position of the scrappy startup and Tesla the incumbant. That is the reason for the market cap, not mean tweets or dank memes - investors don't care about that.
Probably the list of EV leaders will be mostly new companies like Tesla, not legacy brands. Maybe some Chinese companies. Whatever the case it will look very different than today.
Short it then.
Isn't the measure of market cap more a measure of how much one company monopolizes? Compared to an environment of, say, German "mittelstand" medium-sized companies (which don't count, apparently?)
Note also that LVMH are one of the places selling into China, rather than the other way round. Got to recycle those dollars somehow.
Frankly, I’m not sure why people ignore Aristotle’s idea that the monarch is the people’s best defense against aristocracy/oligarchy.
On the other hand, the US tech giants are headquartered in the US, but are very much multinationals, with people working for them across the world.
This company was profitable?
I used to think this way but no longer do. I mean, the point of being people is to do people things. The point of trying to fix the climate is so people can keep on doing stuff they want (the planet doesn’t care). And so on.
Now indeed, I think ppl should stop doing things that hurt others, but $1,500 scarves aren’t that harmful. And leather is an awful material for most applications these days so these people just hurt themselves :-).
If I were to make a list of useless activities that could safely vanish overnight without me missing them, I would indeed wave my wand at fashion, as well as vehicle racing; all forms of movies, video, YouTube, etc; the music “industry” (not musicians!); motorized watercraft; Internet advertising; fast-food restaurants; celebrities… But some people would (inexplicably to me) not agree. And would make their own lists. Fortunately none of us are dictators, in this regard at least.
> I believe royals are the biggest grifters on earth.
Bad as aristos are, there are even bigger grifters!
Funny how this works. One of the great premises of the Culture novels, formative for so many nerds, was that material plenty and AI governance would get us to a point where anyone could have as much of those things as they wanted. With none of the downsides.
But given how long the list is I'm baffled at what you and your family might do for entertainment.
Jeez there’s so much choice! Reading books, making music, backpacking, biking, kayaking, writing code, hanging out with friends… come to think of it, the same stuff our friends like to do too, which I guess shouldn’t surprise me.
It's funny because I have a similar list but fashion would not be something I would want to disappear. Fashion is culture and art. Fast fashion and production that harms people and the planet is not good, but fashion designers can be very much like musicians.
So it doesn’t make sense to say a company’s value is “fake”, what you’re actually saying is that you highly disagree with what the market thinks the value is. You not agreeing with the value doesn’t make the value invalid.
Don't forget that Amazon / apple / google make a lot of money off games / useless items or basic advertising.
We have ecommerce and delivery too, just splitted into X companies across countries instead of one big
These days it’s doesn’t make sense to buy a worse and more expensive electric car or laptop unless you really don’t like Tesla or Apple.
The Honda and Toyota Dealerships I've been going to are selling Model 3 equivalents (Accord and Camry) for around $35-40k (and this if for ICE/Gas versions - their hybrids are just as expensive as the Tesla if not more).
When you factor in California gas prices and gas taxes, a premium/mid-level sedan evens out with a Tesla Model 3, hence why you see Teslas almost everywhere in California now.
I am puzzled. You know that Europe is a big place and that LVMH is from France, the place famous for not having royals?
Also, much of LVMH revenues come from the US and China. Neither place is really known for their fancy royals, either.
Also, market cap says more about the amount of money flowing around than the intrinsic value of the companies. Tesla’s valuation is more correlated with hype (and the status symbol and luxury character of the cars, similar as Apple, which you left out somehow) than innovation.
Your points need a bit of work to be convincing.
LVMH - Revenue by key regions - https://www.lvmh.com/investors/profile/financial-indicators/...
- Asia - 23,785 M€ revenue
- United States - 21,542 M€ revenue
- Europe - 12,717 M€ revenue
- Other markets - 9,632 M€ revenue
- France- 6,071 M€ revenue
- Japan - 5,436 M€ revenue
Isn't it funny that the country that supposedly is the biggest innovators in the world, are one of the biggest consumers of luxury goods?
Who is the fool here really, the one who sells the luxury goods, or the ones that buy it?
Not really. That's exactly what you'd expect, since the ones that innovate have the money to buy luxury goods.
>Who is the fool here really, the one who sells the luxury goods, or the ones that buy it?
Talking about fools, since Tesla is apparently also an overhyped luxury company, who is the real fool here: the ones who make it (the US) or the ones who buy it (Europe)?
If we substract Japan, which is listed individually, you still have ~4.5B in Asia. That's €5.28/person in Asia (-Japan) vs €64.01/person in United States.
[1] https://www.worldometers.info/world-population/asia-populati...
[2] https://www.worldometers.info/world-population/us-population...
From a practical perspective Teslas are simply better daily drivers than other cars.
Whether their price premium, wrt gas powered cars, is justified is a judgement call. I would say yes, but YMMV.
May as well just do an average job
Isn’t it sad that USA’s most valuable companies are advertising agencies?
Isn’t it sad that some of the most valuable companies are renting middlemen(AirBnB, Uber)?
I don’t know, it’s a stock market. At some point the market decided that some game CD retail shop is orders of magnitude more valuable than previously thought.
I wouldn’t read much into this and look for metrics which indicate something tangible like.
Hum... That one is expected. If you improve commerce, you create a huge amount of surplus, and you will certainly be able to take a bit of it.
What is sad is that the current crop of middlemen is so uncreative and risk-free. That means our commerce is so restricted that anybody bold enough to defy the government makes a revolution.
Huh? Which ad agencies are among the most valuable companies in the US? There's Omnicom, but they're not even in the top 100.
edit: jinx
- Sent from my iPhone.
> One is significantly harder and has more utility than the other, indicating an achievement in knowledge and application of that knowledge rather than using figuring out ways to sell people status signals.
But which is which? Because this could apply in both directions. Bags are undeniably useful, even if LVMH's are ridiculously overpriced. But people have also always complained that Apple is overpriced, and mostly selling people status signals.
And Apple is the most respectable of the Big US companies, because Tesla is all hype, Google blatantly abandoned its "don't be evil" creed, and Amazon is known for its inhuman labour conditions.
I don't think any of these are companies to be proud of. We need better. And better is probably not bigger.
I can't find the median, but the average new car price in the US got close to $50k. Which certainly doesn't come close to the average price paid per car currently on the road.
I believe that's both. iPhones seem to be more popular than Android ones on the secondhand market anyway.
'total device shipments':
https://www.counterpointresearch.com/us-market-smartphone-sh...
Statcounter mobile OS (yes, technically tablets and other devices are counted here, too):
https://gs.statcounter.com/os-market-share/mobile/united-sta...
I will agree on one point though. As an export, LV demonstrates a grossly uncraftsman-like aptitude. My wife rebuilds and repairs designer bags. Late LV is some of the cheapest and most shoddily made shit she works on. The older bags are great. But since the 90s, the bags have declined tremendously. The same is true of Gucci. I think this is pretty clearly the product of those two brands absolute explosion in demand over the same period. Most other designer brands are tiny in comparison to these two. Except Hermes, which my wife rarely gets hold of so I'm not sure if they've suffered the same decline with scale.
But no joke, if you're looking for quality, Michael Kors is a far better bag.
As far as I know, Hermes never played fast and loose with quality like the other two but remains considerably more expensive. Note that I mean that in the context of luxury products - quality remains high and I'm not sure I agree that Michael Kors is currently higher quality than Vuitton.
Why is that so? Fashion is often local to the culture, with different cultures appreciating different, if not opposite things. Eg, tanned skin tone. Tanned skin is popular in America, to the point of having tanning salons - it means you have the leisure time to spend it outside. In China, the opposite is true: tanned skin means you're so poor, you work outside. Fairer skinned people have the money to not go outside to work. Thus, what's fashionable isn't been the two countries isn't going to be the same because of similar differences in culture, so it's hard for me to take that for granted that fashion should be movies. And then even then, movies have the similar problem. How many Bollywood hits are global hits?
I mean that from a physical standpoint it's easier to export these things. This because they can largely be exported without a great deal of material or persons moving across borders. For obvious reasons, it's easier to export a purse than a house.
Also, from a legal perspective it is easier. Cars are a great example of this. Car companies have had to expend an enormous amount of effort and money for even just the opportunity to build cars in another country, much less wholly import them there.
Hermès keeps very high standards and treats its employees very well. I've got nothing but good to say about this company, really.
So I figured I'd check what the other largest European companies are. In order: LVMH, Novo Nordisk, L'Oréal, ASML.
#4, ASML, is of course the pride of the Dutch tech industry. That's a company that's innovative on tech and making its profits entirely by making the best chip manufacturing machines.
#3 L'Oréal is primarily known for shampoo and cosmetics and that sort of stuff.
#2 I hadn't heard of. Apparently they mostly provide diabetes care. That's awfully specific for such a big company. No idea if they're big because they're incredibly innovative in that field, or that they're monopolising healthcare.
LVMH's name suggests it's not a company that grew this big naturally, but it rather the result of several mergers. An artificially inflated moloch.
I think most people here would be happier with ASML in the top spot.
The world is an amazing place!
They're one of the Big Pharma firms like Pfizer and GSK, and the only reason Denmark (and specifically Aarhaus) is on the map for bioinformatics.
Separately, why are so many new HN commentators snarky asshats.
That's a sick burn of the Aarhus University Bioinformatics Research Centre https://birc.au.dk/ but maybe that research is only there because of that company too?
Aarhaus has an amazing bioinformatics program thanks to the strong public-private partnership in place between Novo Nordsk, Universitet Aarhaus, and Government intervention.
Denmark's following the same game plan the US applied in the 1970s-80s to the Bay Area, San Diego, and Boston to develop the biotech industry.
Google and Meta sure, what about Apple, Microsoft, Tesla and Amazon?
> Isn’t it sad that some of the most valuable companies are renting middlemen(AirBnB, Uber)?
Not at all. They are first and foremost marketplaces that are actually cutting out middlemen from the equation. Remember taxi medallions?
For the rest, the bulk of their revenue comes from:
- Apple => hardware sales
- Amazon => e-commerce and cloud services
- Microsoft => windows + office + azure cloud
- Nvidia => semiconductors
- berkshire hathaway => diversified investments
- johnson & johnson => pharmaceuticals
- Tesla => automotive + energy
That the EU doesn’t have a meaningful (in terms of revenue production) technology or engineering industry and the top company is a company that makes money by stamping logos on handbags should be concerning and not dismissed. I wish Europe had more innovation, we would all benefit from more people and more companies innovating.
I don't know what definition you're using here, but I think describing e.g. Airbus as "not meaningful revenue" is surprising. What _do_ you mean (not just you but all the "EU has no industry" people) both by "meaningful" and a definition of the industry sector?
A lot of this is country dependent though - eg. Denmark/France are big Pharma players, Norway/Netherlands are major energy sector players, Sweden/France/Germany are major Defense Players, etc.
Also, there's a lot of AMD R&D and production around Dresden, Germany. Right next to Infineon.
Same with AMD - most of their R&D is still done in the Bay Area and Texas, and based on LinkedIn their Germany employees make up 1% of total headcount.
Most R&D in the chips world is simply done in the US, Japan, SK, and Taiwan, with significant regional presences in Israel, China, India, Malaysia, and Singapore.
really???
Apple is not an advertising company.
Amazon is primarily AWS, The retail division does have advertising but its not its primary business although it is growing.
Microsoft has Bing but its by no means anywhere close to having revenue close to its other products.
Google is the only company that is advertising focused.
AWS can push out the newest weird-named redundant product all they want, but no one will even hear of it without Advertising.
The US could send Europe to the dark ages overnight by turning off all of its software. That’s real value, not luxury handbags.
Of the top 10, only #3 Google and #7 Meta could be called "advertising agencies", and even then they do a lot more.
1. LVMH stems from France, a company famous for not being really friendly to royals.
2. The bulk of LVMH's brands customers are not royals; they're spawns of neo-liberalism and their wives/daugthers/mistresses: US businessmen, Chinese moguls, Russian oligarchs, UK investment bankers, ...
3. Isn't it sad that US top companies are advertising agencies and mind-manipulative megacorps?
This is a very open ended description of a company that can be applied to many of them, including LVMH
Prediction: by 2040 Europe will be in really bad shape, its main industries like automotive will be woefully behind Tesla and a slew of Asian automakers. Its non-existent AI efforts will mean it will be a backwater of technical innovation clinging on to the coattails of US and Chinese technology. Its welfare state will have become insolvent due to too many retirees and not enough workers. I don't see it surviving in its current form for another 20-30 years.
If anything, Spotify is a glorified streaming webapp. I wouldn't call that high tech.
> I think Europe needs to look long and hard in the mirror and realize that most of its policies are not working
Because for sure all the policies that lead to people not having any sort of medical coverage, bills $200 for insulin vials that cost a couple $ to make, produces electricity mainly by burning stuff, has one of the highest murdering rate of any develop country, the highest incarceration rate of the world, has police randomly kill people in the street because their color was suspect, has its policies figured out.
> a failed covid-19 vaccine rollout
Wait, are you living in the US? The same US that was for a long time riding the highest part of the COVID train despite being the last to be hit?
> EU bureaucracy trying to nickel and dime vaccine makers
Being pissed at the very same pharmaceutical companies you gave billions to research a vaccine, now trying to pretend it never happened and didn't help, and trying to do something about it, is so 2019.
> The US and other Asian countries have these issues with birthrates as well but they do have economies that are innovative
The only thing that matters is innovation and building Twitter or TickTok. Never-mind other things like making sure people don't die of diabetes, or non-computer related industries like aeronautic, nuclear, automotive, and others in which Europe is still very much relevant.
> Prediction: by 2040 Europe will be in really bad shape [..] I don't see it surviving in its current form for another 20-30 years.
The extreme capitalism going on in the US, on the other hand, is working great, and can last forever. We're not all going to our doom.
> a failed covid-19 vaccine rollout [1]
[1] - https://www.nytimes.com/2021/05/17/opinion/europe-vaccines-c...
and https://www.statista.com/chart/24471/covid-19-vaccine-doses-...
> EU bureaucracy trying to nickel and dime vaccine makers
The effective mrna vaccines(moderna/pfizer), and non-mrna(JnJ) were funded under operation warp speed in the US, and when the vaccine makers were negotiating with the EU, the EU tried to get absolute rock bottom prices which led to shortages and needless deaths[2].
[2] - https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8426978/
and https://unherd.com/2021/02/why-the-eu-lost-the-vaccine-war/
> The US and other Asian countries have these issues with birthrates as well but they do have economies that are innovative
Because Germany closing all of its clean nuclear power plants is innovative? [3]
[3] - https://www.cnbc.com/2023/04/18/germany-shuts-down-last-nucl...
You mentioned diabetes like it isn't prevalent in the EU, well lets debunk that quickly[4], the UK, Germany and Italy all had more diabetes deaths than the US(all data from 2021):
[4] - https://www.statista.com/statistics/1081226/diabetes-related...
and for the US - https://www.cdc.gov/nchs/fastats/diabetes.htm
US - 79.11 years, source - https://www.macrotrends.net/countries/USA/united-states/life...
Europe - 79.09 years, source - https://www.macrotrends.net/countries/eur/europe/life-expect...
But yes if we want to strictly compare literally all of Europe with all of the USA then we have to get into the business of debating the merits of the Russian and Azerbaijani healthcare systems. No thanks.
Actually no, since luxury items sell at highest margin so it makes complete sense that a luxury item company would be valued high, as long as there is a demand for their wares - which at the moment seems to be there.
> What a sore lack of innovation…
Again, not sure what you means since in a way since designers and fashion companies need to keep on innovating new trends and designs and IMHO are one of the most creative and innovative in the true sense.
It's not about the item, it's about what you get after you give the item as a present ;)
For Europe, it’s luxury goods + cosmetics
For the Middle East, it’s energy
For the US, it’s things like tech + media + finance
It doesn’t mean that Europe lacking in innovation in those other industries, just that the luxury goods market is an outsized one for them.
1. Europe is more linguistically fragmented than the US. For example, the EU has 24 official languages while the US effectively has two. Because of this, in Europe network effects and economies of scale are more difficult to achieve with products that could compete with YouTube, Instagram, and so on. Instead, many European products that are popular are those that don't rely on network effects: cars, appliances, clothing, and food. Meanwhile, because of its more cohesive market, the US has seen higher returns to investment in movies, music, and social networks. Thanks to having more resources, many of those products become enormously successful domestically and end up being exported.
2. The stock market generally plays a smaller role in financing companies in Europe than in the US. For example, the Czech JetBrains is not traded in the stock market at all, and the Swedish Spotify's debt-to-equity ratio is 47% while Meta's is 8%.[1] Two companies with equal future EBITDA streams have different valuations for their stocks if one of them is primarily debt financed and the other is primarily financed through the stock market.
[1] https://ycharts.com/companies/SPOT/debt_equity_ratio https://ycharts.com/companies/META/debt_equity_ratio Although admittedly this is an imperfect comparison.
Another view would be that LVMH make products that people (maybe not SWEs) actually desire. Apart from Apple and Tesla most US tech giants just offer services that people use because they have to, or for mindless entertainment.
And... as any girl should have told you by now: size isn't everything. In Europe we prefer to buy locally produced food in local pedestrian districts to driving to giant Walmarts -- and so on across the board.
We'll happily trade 6 weeks annual leave, parental leave, socialized healthcare and many other things (freedom from school shootings, lower child mortality, longer life expectancy, vastly lower inequality etc etc) for your size-based bragging rights.
As for innovation: we're doing fine. The web originated in Europe and so did a lot else, including the world's largest and best regulated market, something Americans can only dream of:
https://fsi.stanford.edu/events/why-europe%E2%80%99s-single-...
Does the idea of luxury ever change rapidly?
Not sure about this. Luxury goods stocks are famously cyclical, and tends to be something people drop quickly if they cannot afford during business downturns, as other more vital purchases takes preference. At least compared to stocks for big general stores etc.
Meta valuation is strongly associated with the network effect of its apps. The value of the actual assets (technologies, data-centers ...) is far lower than the market cap.
Creating a FB and Instagram 1:1 clone would significantly cost less than the current $500B market value.
It also speaks volumes about the true role of Europe in today's global economic landscape: recycling its long tradition of aristocratic affluence and "bon viveur" know-how to feed the needs of the global nouveau riche.
The reasoning, as far as I understand it, is that the UK gained a notoriety in the 1900's and blair era for always doing (often dirty) favours for the countries that actually do stuff, just like a butler.
According to Wiktionary bon viveur is a valid [English] synonym of bon vivant[0] although noted as "pseudo French" in wiki[1].
[0] https://en.wiktionary.org/wiki/bon_viveur
[1] https://en.wikipedia.org/wiki/Bon_viveur
Edit: Clarified that this is an English Language synonym after astute observations from Francophone commenters
The GP is bashing Europe for "recycling its long tradition of aristocratic affluence" but is at the same time using fancy foreign phrases -- "bon viveur", "nouveau riche"... What is be the reason? Well, to show off and lend credibility to the bashing: "see, I'm part of the circle too, I know the shibboleths; my criticism has more weight because it comes from an insider", is the subliminal message. Using the phrase wrong just looks foolish in these circumstances. Like a child who learned a complicated word and tries to impress with it, but uses it wrong.
Looking on n-grams it seems to have been used since the mid 19th century. Interestingly in en-GB it was even more popular than bon vivant in the 70s and 80s[2].
I have no opinion on the GP's original use of the phrase, but I don't think noting that a phrase which evolved in a different language to its origin is now different to the original shows too much.
[0] https://www.merriam-webster.com/dictionary/bon%20viveur
[1] https://www.collinsdictionary.com/dictionary/english/bon-viv...
[2] https://books.google.com/ngrams/graph?content=bon+viveur%2Cb...
> One of the key drivers for people from modest financial backgrounds to spend on luxury goods is aspirational buying. Owning an item from a prestigious brand like LVMH is perceived as a status symbol, and it allows individuals to feel like they belong to a higher social class.
If you come from a modest financial background (aka, probably behind the curve on retirement/investment/emergency savings/debt/net worth goals), then dream of an expensive item you can't really afford so that it will make you feel richer than you are, while the cost of the item sets you back FURTHER on a goal you were already behind on...
What % of LVMH buyers have a less than $10k net worth? What's the breakdown of their revenue/sales from "people who are ultra-wealthy and can actually afford a $100k Birkin bag" versus "people who shouldn't be buying any Gucci/LV $300-$1.2k products whatsoever from a financial well-being perspective"
> The Louis Vuitton leather goods collections are exclusively produced in our workshops located in France, Spain, Italy and the United States.
https://en.louisvuitton.com/eng-nl/faq/products/eu-where-are...
Edit: Of course my Europe comment is not quite right as some made in the US too.
https://www.challenges.fr/economie/ce-cash-investigation-qui...
rough translation:
> Workers' testimonies of this company, for the most part immigrants, are overwhelming: fingers cut by the machines, work without a break of 13 hours a day, entire months of unpaid salaries, multiplication of work accidents... and a local work inspection who doesn't give a shit.
boycott them
Even for Louis Vuitton, having them in Europe is about sweatshop-washing, plus some nice "main" workshops to show to the press, Potemkin village style.
And such wordings "The Louis Vuitton leather goods collections are exclusively produced in our workshops located in France, Spain, Italy and the United States" are worth almost nothing, given how lax the law is for businesses saying such things. There are "percentages" allowed (if X% is being made in Y, you can still call the product made in Z, even if it's the hardest/more work intensive part), there are tricks like naming where you do the final assembly, even mere final packaging in some cases.
And you can always just recreate nice sweatshop style environments domestically, complete with migrant labor, below minimum wage, threats, and so on:
https://www.independent.co.uk/news/uk/home-news/boohoo-leice...
https://us.fashionnetwork.com/news/made-in-italy-by-chinese-...
Not that it's better for other brands:
https://www.newyorker.com/magazine/2018/04/16/the-chinese-wo...
https://ameli-zurich.com/en/blogs/ameli/made-in-italy-vs-100...
Not that LV has a much better history:
https://www.theguardian.com/business/2017/jun/17/revealed-th...
https://www.nytimes.com/2018/09/20/fashion/italy-luxury-shad...
Bonus LVMH:
"The report also found that the world’s largest luxury brands are among the worst offenders in addressing the worse forms of exploitation in their supply chains, with an average score of 31 out of 100. French luxury goods company Kering (owner of the Alexander McQueen and Gucci labels) scored 41 out of 100, while LVMH (owner of the Christian Dior and Louis Vuitton labels) scored 19 out of 100" https://www.aljazeera.com/economy/2021/7/14/are-your-favouri...
Would you like to provide a link to support this claim in your OP rather than links about Europe or supply chain transparency.
What you are peddling in this comment thread is utter garbage and so untrue it’s laughable. It’s clear you have an axe to grind but very little idea of what you are actually talking about.
Thanks for the ad hominem and rude tone by the way.
Here's how "laughable" it is: https://www.theguardian.com/business/2017/jun/17/revealed-th...
> Thanks for the ad hominem and rude tone by the way.
Entierely deserved. Being an idiot is one thing, insulting an entire industry you clearly have no idea about another. I have no respect for you and you are not showing me anything which would convince me I should.
Or possibly a comment on how Europe is unable to innovate so it makes sense their largest company relies on old, traditional perceptions of “European luxury” in craftsmanship when in reality it’s just outsourcing to the same factories as everyone else. But vapid people still fall for it.
The wealth will trickle down to people suffering 10-40% food and housing inflation any time now.
It’s also apparently a luxury goods company, so it’s somebody buying a Louis Vutton handbag and paying for somebody else’s salary.
Whether or not you think that situation is fair, this is a clear case of a company facilitating the transfer of money from the well-off to the less well-off via salaries and taxes.
So in this case, consumption by a wealthy customer base benefits a broader population as well. The wealth actually does “trickle down” to an extent.
Anyone with any kind of asset made out like bandits. Meanwhile, bottom 50%ile without homes or stocks or crypto were told to come into work because their work was "essential" while also watching their purchasing power drop every week.
Depends entirely on the asset class. A lot of people lost a ton of money on pandemic-related stocks (pharma), crypto, real estate, landlords, banks... the only ones making utter bank are those profiting off the Russian invasion and those who can raise prices at will due to inelastic demand (basically, supermarkets).
Though honestly, unless you were buying absolute junk, you’re likely still up a great deal. Bitcoin is up over 20k from the pandemic lows, SPX is up 77%, even stocks that got hammered like Meta are up from the pandemic bottom.
Anyone who lost money during this period likely had themselves to blame for not exercising basic risk management.