STORY: :: File

Sales at Europe's biggest luxury brands have declined in Dubai and Abu Dhabi as the Iran conflict hit the sector's fastest-growing market.

It's the latest setback for the $400 billion industry, whose value has contracted over the last three years, and a sign of the conflict's impact on the luxury sector.

At the Mall of the Emirates, one of Dubai's largest, luxury brands reported 30-50% sales declines in March, compared to the same month last year.

That's according to a source with knowledge of the previously unreported figures.

The source also said the number of shoppers visiting the Mall of the Emirates was down 15% in March, while foot traffic at the larger Dubai Mall was down around 50%, which could mean a potentially even larger sales drop.

In Abu Dhabi, a smaller shopping hub than Dubai, March sales at the Galleria Mall were more resilient, but still down around 10% across the board, according to an industry source.

None of the companies responsible for operating the Mall of the Emirates, Dubai Mall or Galleria Mall replied to a Reuters request for comment.

The Middle East accounts for roughly 5% of global luxury consumption.

Analysts say it has been one of the luxury industry's rare bright spots, reporting double-digit annual revenue growth in recent years. 

:: February 28, 2026

:: March 16, 2026

But Dubai's carefully curated image of glamour and stability has been shaken by the Iran conflict, with the city's major airport and other infrastructure targeted by Iranian drone attacks.