Mounting crises at LVMH following data breach and Loro Piana labour allegations

August is traditionally when the fashion world exhales. With production halted, factories shuttered, and ateliers dimmed across Paris, Milan, and Rome, the industry slips into a heat-induced siesta. The only thing more predictable than a Riviera Instagram post is the chorus of auto-reply emails.

But if you're LVMH, there's no such thing as summer break this year.

The luxury behemoth is weathering one of its most tumultuous periods in recent memory. In just the span of a week, three separate crises have surfaced—each carrying serious reputational and financial consequences.

A tumultuous year

First, the looming 30 percent tariffs set to be imposed by the U.S. administration on August 1st. These will hit LVMH's American operations particularly hard. Despite intense lobbying from the Arnault family—whose personal ties to Mr. Trump run deep, with widely circulated photos of the Arnaults attending his inauguration—the conglomerate seems to have failed to shield itself from the blow. Washington is unmoved, and Wall Street is watching.

Then came the third data breach in as many months, this time compromising the personal information of Louis Vuitton customers in the UK, including names, contact details, and purchase histories. This follows earlier cyber incidents in Turkey and South Korea. Yes, even the most secure systems are vulnerable, but for a group that prides itself on exclusivity and discretion, these repeated failures are more than just digital flukes. They erode trust.

And now, perhaps most damning of all: allegations of worker exploitation at Loro Piana, LVMH’s ultra-luxury cashmere house—where a wool field jacket can easily set you back 6,000 euros. Italian authorities, along with a company source, revealed that subcontractors were engaging in illegal labour practices. The company has yet to issue a formal response, but the comparisons to last year’s Dior production scandal are unavoidable. That debacle saw Dior’s Italian manufacturing arm placed under judicial administration, after inspectors uncovered sweatshop-like conditions inside subcontracted workshops. For a group that sells heritage and craftsmanship, these allegations are nothing short of corrosive.

All of this comes amid a troubling 30 percent decline in LVMH’s share price from its peak, an erosion of investor confidence no PR campaign can polish away. Some analysts have openly questioned the timing of LVMH’s splashy 1 billion dollar Formula 1 marketing deal, wondering if the money might have been better spent stabilising its wide and wobbling portfolio of brands.

And the pressure’s not easing. July is the month when luxury groups report their Q2 earnings, with LVMH scheduled to release its figures on July 24th. Q1 was already softer than expected; Q2 could either stabilise sentiment—or deepen the market's concerns. Of course, fashion thrives on reinvention, and there may be bright spots. The industry is watching closely to see whether Jonathan Anderson’s appointment at Dior can inject some much-needed energy into the maison, and the group at large.

For now, though, one thing is clear: while most of fashion hits pause for the summer, LVMH is very much still at work—because it has no choice.