RBC Capital Markets has highlighted a set of luxury companies it believes are positioned to perform as consumer preferences and technology continue to reshape the sector in 2026. The firm evaluated recent earnings, product rollouts, management changes and regional demand dynamics to identify names with the strongest near-term prospects.
EssilorLuxottica
EssilorLuxottica delivered a notably robust Q4 2025, reporting revenues about 6% above consensus and registering currency-adjusted growth of 18%. The upside was driven largely by strength in Professional solutions and North American operations. A collaboration on smartglasses with Meta contributed roughly 15 percentage points of organic growth in the quarter, and the company sold more than 7 million units across 2025. Trading into January 2026 has kept double-digit momentum, though at a pace likely below Q4’s surge.
The company is progressing other initiatives beyond smartglasses. Its Stellest myopia control lens is at an early stage of rollout in the United States, and management plans to expand retail availability materially beyond the current footprint of 4,000 doors. In optical retail, a subscription-based model is gaining traction, already accounting for 22% of EMEA optical retail revenues and driving higher customer attachment and spend.
EssilorLuxottica also faces legal and analyst developments. Solos Technology has filed a patent infringement lawsuit related to smartglasses technology. Separately, Kepler Cheuvreux has upgraded the stock to Buy from Hold and lifted its price target to 2350.
Herm E8s
Herm E8s reported Q4/FY25 revenues about 1% ahead of consensus, with all divisions except Perfumes exceeding revenue growth expectations. The company recorded an operating profit for fiscal 2025 of 6.57 billion, representing a 41.1% operating margin and coming in roughly 3% above consensus, aided by stronger-than-expected gross margins.
Management reaffirmed a long-term growth objective of 6-7% combining volume and pricing. Pricing is expected to be slightly more pronounced in FY26, near 6%, as a partial offset to cost and wage inflation. While the timing of Chinese New Year complicates assessment of current trading patterns, management indicated growth across regions. Inventories remain "comfortable" across businesses and geographies, most notably in Leather Goods. The company continues to pursue vertical integration, planning one new leather workshop in 2026 and two additional workshops in 2027 and 2028.
Kering
Kering posted Q4/FY25 revenues approximately 2% ahead of consensus, delivering modest upside across its brands. New CEO Luca De Meo provided a positive initial impression by outlining a strategic direction for the group, with fuller detail scheduled for the Capital Markets Day on April 16, 2026. Kering E2s FY26 financial framework is focused on returning to revenue growth and expanding margins, and RBC notes this framework was better than feared.
Visibility into the recovery remains gradual. For Kering, a rebound in the broader luxury demand environment along with a favorable customer response to creative leadership at Gucci under Demna are both needed for a stronger equity narrative. RBC suggests that in a scenario of a soft luxury recovery in 2026, Kering E2which has a more fashion-forward portfolio relative to some peers-could be a significant beneficiary.
Operationally, Kering announced that the CEO of its Bottega Veneta brand will depart at the end of the first quarter of 2026. The group also entered a joint venture with investment firm Ardian for a property on New York E2s Fifth Avenue.
Pandora
Pandora E2whose Q4/FY25 results were in line with pre-announced figures E2provided FY26 guidance implying organic growth of -1% to +2%, a midpoint that sits about 300 basis points below consensus. The company E2s EBIT margin guidance of 21-22% is broadly consistent with expectations.
New CEO Berta de Pablos Barbier laid out a plan to refresh Pandora E2s core assortment through more distinctive collections and an emphasis on earned media. The firm confirmed a new platinum-plated collection, Evershine, as part of that effort. Pandora has hedged approximately 95% of its cost of goods sold exposure for FY26, which provides a margin floor through the year. The principal uncertainty flagged in the company E2s outlook is the FY27 margin trajectory as it shifts toward a higher share of platinum-plated products.
Separately, Pandora launched a new jewelry collection in collaboration with the Netflix series Bridgerton.
Context and takeaway
RBC E2s selection underscores how differentiated operational drivers within luxury - from smartglasses partnerships and subscription retail models to product mix transitions and management resets - can shape prospects even as regional demand patterns evolve. Investors and market-watchers will likely focus on execution of product rollouts, management strategies and margin durability as key determinants of performance across these names in 2026.