Burberry same-store sales are up 40% so far this year in the Middle East, a bright spot in what is becoming an increasingly challenging market. While 2008 net profit was up 13% through September to $112 million, Burberry chief executive Angela Ahrendts warned of tougher conditions through the end of the year. Burberry shares on the London Stock Exchange fell 13% following her comments.

After showing resilience as the economy tanked, some luxury goods makers are beginning to take a hit. Italian jewelry maker Bulgari SpA posted a 44% drop in third-quarter profit, and Saks Inc. reported a $42.8 million loss for the quarter. Elsewhere, makers of high-end clothing and accessories from Louis Vuitton to Chanel SA are dropping prices as high-net-worth consumers begin scaling back purchases. - Suzanne Stevens