LVMH sold DFS's Hong Kong and Macau business for $395M — after profit crashed 87%

DFS Group, the travel retailer owned by LVMH since 1997, agreed to sell its entire Hong Kong and Macau business to CTG Duty Free (China Tourism Group Duty Free Corporation) in January 2026. The sale price was capped at $395 million — a fraction of what the business would have commanded during the pre-pandemic luxury travel boom.

The sale was forced by a brutal financial reversal. DFS's Hong Kong and Macau operations generated net profit of $135.6 million in 2023 but crashed to just $17.9 million in 2024 — an 87% collapse. The decline reflected a market where mainland Chinese tourist spending patterns had structurally changed: shoppers were buying luxury goods on Hainan Island's duty-free market or directly through mainland e-commerce platforms rather than in Hong Kong and Macau.

LVMH characterized the sale as finding the right long-term owner for the business, citing CTG Duty Free's expertise in travel retail. But the message was clear: LVMH was exiting a market it had dominated for decades. The sale included all DFS retail stores in Hong Kong and Macau, along with the DFS brand and intellectual property rights in Greater China. CTG Duty Free, the state-owned Chinese travel retail giant, became the dominant player in the region's duty-free market.