Shares of LVMH dropped to their lowest level of the year on Wednesday morning, after the company reported a slowdown in revenue growth that was below expectations.

The stock was down 6% at 11:58 a.m. London time, trading at 689.4 euros ($730.96). Earlier in the session it fell to 683.2 euros, its lowest level since Dec. 29, 2022, according to LSEG data.

The world’s largest luxury firm, seen as a bellwether for the industry, posted nine-month and third-quarter results after the market close Tuesday.

The report showed quarterly revenue growth of 9% year on year, a sharp fall from 17% in the second quarter. Analysts had forecast growth of around 11%.

Revenue was up 14% in the first nine months of 2023, versus 20% growth in the same period last year.

Most business segments showed growth, though there was a notable 10% fall in wine and spirits during the nine months to October, which the company attributed to a post-Covid-19 normalization, high stock among retailers and a slowdown in Hennessy cognac sales in the U.S.

“After three roaring years, and outstanding years, growth is converging toward numbers that are more in line with historical average,” LVMH’s chief financial officer, Jean-Jacques Guiony, told analysts, according to a Reuters report.

LVMH sales soared during the pandemic, lifting the company to record results and boosting its share price to record highs this year. However, the disappointing Chinese reopening and a pullback in U.S. sales have dented sentiment.

The luxury titan lost its status as Europe’s most valuable company by market capitalization last month to Danish pharma firm Novo Nordisk, which has rocketed higher on account of its weight loss drugs Ozempic and Wegovy. .

“In an uncertain economic and geopolitical environment, the Group is confident in the continuation of its growth and will maintain a strategy focused on continuously enhancing the desirability of its brands, drawing on the authenticity and quality of its products, excellence in distribution and agile organization,” LVMH said in a statement accompanying the results.

Several analysts trimmed their price targets for LVMH on Wednesday.

The results dragged European luxury stocks lower more broadly, with Christian Dior — which is helmed by Delphine Arnault, daughter of LVMH Chairman and CEO Bernard Arnault — down 5.25%.

Richemont, Burberry, Hugo Boss, Hermes and Kering, which are not under LVMH ownership and have yet to report for the quarter, were among those trading lower.

“The dynamics within the luxury goods sector are changing, and today LVMH’s share price is a victim of that,” said Kathleen Brooks, founder of Minerva Analysis, adding that the results of previous years were an “impossible high standard to follow.”

“Usually luxury goods perform well in economically challenging environments, however there are multiple economic and geopolitical threats to the industry which are happening all at once and this could have an impact on the future outlook,” Brooks said in emailed comments.

That includes China shifting to a structurally slower pace of growth and higher interest rates dampening U.S. demand for “affordable luxury,” she said.

“The luxury sector is often seen as being relatively insulated from fluctuations in the economy but expectations and valuations had become very elevated,” said Russ Mould, investment director at AJ Bell, in a note.