Bernard Arnault, the chairman and CEO of the renowned global luxury goods conglomerate LVMH, has claimed the title of the world's richest man, surpassing Elon Musk. LVMH boasts iconic brands such as Louis Vuitton within its portfolio.
Forbes magazine reports that Arnault, along with his family, witnessed a remarkable surge in their net worth, reaching $207.8 billion following a substantial increase of $23.6 billion on Friday. In contrast, the net worth of Tesla's CEO, Elon Musk, was noted at $204.5 billion on the Forbes real-time billionaires list.
Who is Bernard Arnault?
Bernard Arnault, the astute French businessman, currently holds the dual roles of Chairman and CEO at LVMH Moët Hennessy Louis Vuitton. This conglomerate stands as one of the foremost luxury products groups globally, boasting ownership of approximately 70 companies, including iconic brands such as Dom Perignon, Louis Vuitton, Fendi, Marc Jacobs, and Fenty Beauty by Rihanna.
Born into an industrial family in Roubaix, France, Arnault embarked on his professional journey as an engineer. His ascent to the position of Chairman began in 1978, and in 1984, he spearheaded the reorganization of the Financière Agache holding company. The LVMH website acknowledges his pivotal role in returning the group to profitability while outlining his strategy to transform it into the world's leading luxury products company. This period also witnessed the revitalization of Christian Dior as a cornerstone within the new organizational structure.
In 1989, Bernard Arnault became the majority shareholder of LVMH Moët Hennessy – Louis Vuitton, subsequently assuming the roles of Chairman and CEO. His influence extends to his four children, all actively involved in various companies under the LVMH umbrella.
What is the Forbes List?
Forbes Magazine annually publishes a list of the world's wealthiest individuals, featuring notable figures like Lakshmi Mittal, Kumar Birla, and Shiv Nadar in its April release. However, Arnault's temporary surpassing of Musk was noted on the Real-Time list, which is accessible year-round. This list employs a ranking system that "tracks the daily ups and downs of the world’s richest people."
The Real-Time list updates the value of individuals' public holdings every five minutes during stock market hours. Individuals with substantial ties to private companies see their net worth updated once a day. This dynamic update explains the day-to-day fluctuations in rankings. Notably, a few months ago, Adani briefly claimed the second position, displacing Arnault on the same Real-Time list.
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Top 10 Richest People in the World:
The Forbes real-time billionaires list reveals the top 10 richest individuals globally:
- Bernard Arnault & Family ($207.6 billion)
- Elon Musk ($204.7 billion)
- Jeff Bezos ($181.3 billion)
- Larry Ellison ($142.2 billion)
- Mark Zuckerberg ($139.1 billion)
- Warren Buffett ($127.2 billion)
- Larry Page ($127.1 billion)
- Bill Gates ($122.9 billion)
- Sergey Brin ($121.7 billion)
- Steve Ballmer ($118.8 billion)
Notably, Mukesh Ambani, chairman of India's Reliance Industries (RIL), holds the 11th position on the World's Richest Persons list, boasting a net worth of $104.4 billion. Meanwhile, Gautam Adani secures the 16th spot with a net worth of $75.7 billion.
Image Source: FORBES
LVMH Q4 Results:
LVMH, the renowned luxury goods conglomerate, demonstrated robust financial performance in the fourth quarter, propelling its market capitalization to $388.8 billion as of Friday. This impressive figure places LVMH in a notable position, especially when juxtaposed with Tesla's market cap of $586.14 billion.
Conversely, Tesla encountered a significant setback in the stock market on Thursday, January 25. The electric vehicle company experienced a 13% plunge, resulting in Elon Musk's net worth plummeting by over $18 billion, as reported by Forbes. This decline came on the heels of Musk's announcement that sales growth for Tesla would decelerate in the upcoming year.
In stark contrast, LVMH witnessed a surge in its shares, climbing over 13% on Friday around 11 am. This surge was attributed to the news of strong sales, particularly driven by resilient demand from Chinese buyers for the conglomerate's high-end fashion offerings.
Recently disclosed financial results show that LVMH experienced a 10% increase in fourth-quarter sales. This growth was fueled by robust demand for its high-end fashion products, with Chinese consumers playing a significant role. The conglomerate, housing renowned brands such as Louis Vuitton, Dior, and Tiffany, reported sales totalling nearly 24 billion euros ($26 billion) in the final quarter of the year.
Sales within LVMH's fashion and leather goods division, encompassing major labels like Vuitton and Dior, saw a 9% increase during the quarter, just shy of the expected 10% growth. Additionally, the conglomerate noted growth in sales of perfumes, cosmetics, watches, and jewellery. However, the wines and spirits unit experienced a 4% decline in sales for the full year.
LVMH highlighted challenges in its champagne operations, led by Moet Hennessy, while cognac sales were impacted by the return to post-Covid normalcy in China and the United States.
During the annual general meeting, LVMH's Chairman and CEO, Bernard Arnault, revealed that his sons, Alexandre (31) and Frederic (29), would be proposed to shareholders as new board members.
Image Source: FORBES
Tesla Shares Tumble:
In contrast, Tesla faced a sharp decline of over 12% in its stock value on Thursday. This followed CEO Elon Musk's cautionary statement that sales growth would decrease in the coming year. The market responded with Tesla losing $80 billion in market value, contributing to a total market capitalization loss of approximately $210 billion for the month.
Tesla's fourth-quarter revenue of $25.2 billion fell short of Wall Street's predictions of $25.9 billion. Musk's announcement of a shift in focus to manufacturing more affordable next-generation electric vehicles at the Texas factory in the latter half of 2025 raised concerns about potential challenges and competition.
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Image Source: FORBES
Analysts noted that Tesla's recent financial results were below expectations, and the outlook for revenue and profit was not promising. Concerns were raised about the potential impact on operating margins as Tesla faces stiff competition, particularly from BYD in China.
While LVMH celebrated positive sales figures and an uptick in market cap, Tesla navigated challenges that led to a significant stock decline, prompting a reassessment of its growth strategy and market positioning.
The rankings can shuffle on a day-to-day basis, reflecting changes in the values of publicly traded stocks and private holdings.
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