Smart glasses surge fuels essilorluxottica's sales boom
Meta's smart glasses drive record sales for essilorluxottica
The demand for Meta's smart glasses has significantly boosted EssilorLuxottica, the world's largest eyewear manufacturer. The company reported an impressive 18% increase in fourth-quarter sales, reaching €7.6 billion (approximately $9 billion), surpassing analyst expectations of an 11% rise. This surge in sales, fueled by the popular Ray-Ban Meta and Oakley smart glasses developed in collaboration with Meta, has solidified the partnership's leadership in the emerging wearable tech category.
Strong q4 performance and stock market reaction
Following the announcement, EssilorLuxottica's shares jumped as much as 10% in Milan, marking the largest intraday increase since October. While this partially offset the decline from November highs, the remarkable fourth-quarter performance indicates a strong consumer appetite for connected eyewear. The company’s success demonstrates the growing integration of Technology within everyday accessories.
7 Million smart glasses sold in 2024
Despite not disclosing specific quarterly profit breakdowns, EssilorLuxottica stated it had already sold over 7 million pairs of AI-powered glasses in 2024. This figure highlights the rapid adoption of smart glasses and the collaborative strength of Meta and EssilorLuxottica in the market. The impressive sales numbers suggest a continued upward trajectory for this Technology.
Margin concerns and future growth projections
According to Bloomberg Intelligence, EssilorLuxottica’s strong sales helped mitigate a slight dip in the Ebit margin to 15.7%, slightly below the consensus estimate of 16.1%, attributed to tariffs and the dilution effect of rapidly growing AI glasses. Senior analyst Diana Gomes expressed investor concerns about the costs associated with scaling up production, but EssilorLuxottica assured investors that these factors wouldn't permanently impact margins.
Meta's production expansion plans
Meta announced in January a delayed international expansion of its Ray-Ban Display models (priced at $799) due to supply constraints. Reports indicate that Meta is aiming to double its production capacity to 20 million units or more this year. EssilorLuxottica’s CFO, Stefano Grassi, confirmed they are prepared to manage this increased demand, internally or externally, emphasizing close collaboration with Meta.
Regional sales growth and future outlook
For the full year 2024, adjusted operating profit increased by 6.8% to €4.5 billion, also exceeding analyst expectations. However, tariffs and the increasing sales of AI glasses did impact margins. Sales in North America saw a significant 24% increase, while Europe and Asia experienced growth exceeding 10% in constant currency. The company anticipates continued price increases driven by product innovation, but analysts like Jean Danjou at Oddo BHF caution that margins may face pressure in 2026 due to tariffs and the growing influence of connected glasses.