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This week, softening sales growth at the French giant was the latest sign that the post-pandemic luxury boom is over, but chairman Bernard Arnault may be able to play the weak market to his advantage.

This week, sector bellwether LVMH reported softening sales growth, the latest sign that the luxury goods boom is over as shoppers sober up from post-Covid, YOLO (“you only live once”)-fuelled euphoria, and inflation and high interest rates weigh heavily on discretionary spending.

Sales at LVMH’s critical fashion and leather goods division, which includes key megabrands Louis Vuitton and Dior, grew just 9 percent in Q3, missing estimates by over two percentage points. The result was sharply down from the 21 percent jump the unit generated in the previous quarter and a far cry from the heady days of record revenue growth as the division roared out of the pandemic.

The news sent LVMH shares tumbling to their lowest level since the start of the year and dragged down stock prices at rival luxury players including Richemont, Kering and Burberry.

But a closer look at the results suggests that LVMH chairman Bernard Arnault has a few moves up his sleeve and may be able to play the sales miss to his advantage. Here are a few takeaways from the French giant’s latest disclosure:

Nowhere has the softness been more pronounced than in the US, where pandemic-era stimulus checks contributed to a major surge in luxury spending from aspirational consumers.

With China mired in slow growth, the US market has been critical to luxury sales momentum in recent years. Some luxury players, particularly Kering, moved to tap surging demand with a deeper push into the US, including new stores in second-tier cities, particularly in the American South.

But demand has since dried up and LVMH’s latest results offered no sign that US sales, which grew just 2 percent in Q3, were on the mend, raising the spectre of empty stores from Austin to Nashville.

Despite a poor Q3, LVMH clearly has moves up its sleeve, however. For a group whose key fashion and leather goods portfolio has long been dependent on Louis Vuitton and Dior, the latest results revealed just how far the company has come in turning some of its smaller projects into multi-billion-dollar businesses, notably Hedi Slimane’s Celine reboot and Jonathan Anderson’s reinvention of Loewe.

LVMH doesn’t break out figures for its brands, but market sources suggest Slimane’s Celine now generates more than €2.5 billion in annual revenue, while Anderson’s Loewe is close to crossing the €2 billion mark. Tellingly, management called out Celine and Loewe, as well as long-standing powerhouses Louis Vuitton and Dior, for their “strong performance” in a call with analysts following the results.

The industry is currently swirling with speculation on a new round of designer musical chairs, including what star ex-Gucci designer Alessandro Michele might do next. With the right creative configuration and level of marketing spend, could LVMH leverage its deep pockets to out-muscle competitors weakened by the challenging market and re-energize Givenchy or Fendi, thereby adding to its stable of mega-brands?

Of course, future growth drivers could also come from M&A. And while the latest drop in LVMH’s share price isn’t exactly great news for Arnault’s net worth, the sector-wide depression in stock prices could open up compelling opportunities for M&A for the cash-rich group, with key targets cheaper than ever.

Richemont’s Cartier, for one, has long been on Arnault’s wishlist and likely remains so, despite his $16-billion takeover of the US jeweller Tiffany, which lacks Cartier’s true luxury credentials. Could this be the time to make a play? Of course, Britain’s Burberry, without a controlling shareholder, is technically for sale every day of the week. And the Prada family may be tempted to sell. Stay tuned.