EssilorLuxottica AI glasses sales nearly double as myopia products fuel profit surge

EssilorLuxottica Beats Profit Expectations Despite Revenue Miss

EssilorLuxottica delivered a first-half adjusted operating profit of €2.75 billion ($3.13 billion) in the six months ending June 30, marking a 15% increase that comfortably surpassed the Visible Alpha analyst consensus of €2.46 billion 1

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. The Ray-Ban maker demonstrated resilient profitability even as second-quarter sales of €7.7 billion fell slightly short of the €7.8 billion analysts had anticipated 3

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. The company's operating margin expanded to 18.9% from 18.1% in the previous-year period, while net profits soared by 12.9% to €1.6 billion in the first half 2

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AI-Powered Glasses Show Exponential Growth Trajectory

AI glasses confirmed their position as a major revenue driver for EssilorLuxottica, with sales nearly doubling in the second quarter compared to last year 1

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. The AI-enabled eyeglasses, produced through a partnership with Meta, expanded across global markets and consumer segments while generating sustainable profits, according to CEO Francesco Milleri 2

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. In late June, the companies unveiled a new range of lower-priced AI smart glasses starting at $299, targeting younger, more price-sensitive consumers 1

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. These new models will be manufactured outside EssilorLuxottica's facilities, representing a strategic shift to broaden market reach.

Sales Growth Moderates Amid Regional Variations

Second-quarter sales rose 7.2% to €7.7 billion, reflecting slower momentum compared to the 11% sales growth recorded in the first quarter 2

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. At constant exchange rates, second-quarter revenue increased 8.7%, with the core eyewear and eyecare business delivering mid-single-digit growth 1

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. The Asia-Pacific region drove quarterly expansion with 17% year-on-year growth following the acquisition of Top Charoen's store network, which operates around 2,000 stores in Thailand 3

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. However, North America and Europe experienced softer trends, partly due to conflict in the Middle East.

Myopia Management Products Accelerate Portfolio Diversification

Myopia management products emerged as another significant growth driver, with revenue from the myopia portfolio jumping 24% during the second quarter 1

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. The company has continued to innovate with lenses designed to slow the progression of short-sightedness in children, addressing a growing global health concern 2

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. Beyond vision correction, EssilorLuxottica has branched into hearing correction through Nuance Audio, which integrates hearing aids into eyeglass frames. Milleri announced that a second generation of these products offering better performance would launch in mid-September 2

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Smartglasses Boom Faces Competitive Pressure Ahead

Despite the smartglasses boom, analysts at Bernstein noted that "the point of debate remains the prospects for smartglasses" as the category faces potential competition from Google and Apple, which are preparing their own wearable tech models 3

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. However, UBS analysts maintain that significant untapped opportunity remains, stating that "greater competition is necessary to help build the category and accelerate adoption in the U.S. and globally" 3

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. EssilorLuxottica's shares have nearly halved from their mid-november peak amid concerns over the smart glasses outlook, profitability concerns, and uncertainty at major shareholder Delfin 1

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. The company confirmed its medium-term outlook of "solid growth" in total revenue and "broadly aligned" increases in adjusted operating profit, though it provided no numerical guidance.