Cartier owner Richemont announced Wednesday, July 16, that its sales revenue increased in the latest quarter, despite the impact of a strong euro and weak sales in Asia, its core market. In addition to Cartier, the Swiss luxury giant also owns luxury jewelry and watch brands Van Cleef & Arpels, Baume & Mercier, Jaeger-LeCoultre, Piaget and Vacheron Constantin, as well as luxury fashion and accessories labels including Alaïa, Chloé, Delvaux, Dunhill and Montblanc.
The Swiss luxury group, one of the world’s largest by revenue, reported total sales up three percent from April to June to 5.4 billion euros ($6.3 billion) . However, the weaker dollar capped growth that would otherwise have been six percent.
The company reported double-digit sales growth in regions such as Europe, North and South America, Middle East and Africa (both on a currency-adjusted and actual rate basis), with jewelry being the main driver of growth.
“The group’s four jewellery houses – Buccellati, Cartier, Van Cleef & Arpels and Vhernier – posted sales growth of 11 percent, the third consecutive quarter of double-digit growth,” the company said.
However, a 4 percent decline in Asia-Pacific sales and a 13 percent decline in Japan at current rates weighed on overall sales, as did a 10 percent decline in revenue in the watch division, which includes brands such as IWC, Piaget and Vacheron Constantin.
Overall quarterly sales were in line with forecasts from analysts polled by Swiss financial news agency AWP, although the leading jewellery segment performed slightly better than analysts had expected.
Turbulent times
“Richemont has achieved encouraging results, especially compared with other players in the luxury goods market,” said Jean-Philippe Bertschy, an analyst at Swiss investment company Vontobel.
However, he expressed caution about the sector as a whole, citing a continuing lack of “feel-good factor” and continued low consumer confidence.
US investment bank Jefferies said Richemont had posted “strong” quarterly results and expected the company to repeat the success in three months, demonstrating “clear superiority over its luxury peers”, adding: “We doubt others will see how much the strength in the US offsets weakness in China and Japan.”
In a study published last month, US consultancy Bain & Company warned that the luxury goods sector is likely to experience one of its most turbulent periods in 15 years in 2025 , barring the shock of the COVID-19 pandemic followed by a very strong rebound.
That’s because the sector is grappling with both a wait-and-see attitude from Chinese consumers and significant uncertainty over U.S. consumer spending given the volatility surrounding tariffs.
John Cox, an industry analyst at financial services firm Kepler Cheuvreux, looked closely at Richemont’s data and noted that sales in America were “particularly encouraging, while Europe remained strong.”
“However, the situation in China remains extremely difficult, and in the luxury goods sector the situation is much worse than expected at the beginning of the year,” he added.
Like many other luxury houses, Richemont is looking to expand its customer base by investing in the beauty sector and offering more affordable products. Following the example of its French rival Kering, the group has announced the launch of a dedicated beauty division in 2023. However, sales in this segment still represent only a small share of the group’s overall revenue.