The company reported a 10% year-on-year surge in sales, reaching €6.2 billion ($6.37 billion) for the three months ending December—far surpassing analysts’ forecasts of a modest 1% increase.
The robust results signal a potential turnaround for the luxury industry, which has been grappling with slowing demand. Shares of Richemont soared 7% in premarket trading, while rival Swatch also saw a 3.9% uptick, reflecting renewed investor confidence.
“This is an encouraging sign that the previous quarter may have been the low point,” said Bernstein analyst Luca Solca, referencing Richemont’s earlier struggles, including a 1% sales decline in its second quarter.
While challenges persist in China—where sales dropped 18%—strong performances in other regions more than offset the decline. U.S. sales were buoyed by a post-election spending boost, while a strong dollar fueled tourist shopping in Europe. Japan also benefited from a weaker yen, attracting high-spending visitors.
Despite the positive momentum, Richemont remained tight-lipped on its future outlook. The company continued investing in marketing and exclusive in-store experiences to engage its high-net-worth clientele.
Kepler Cheuvreux analyst Jon Cox praised the company’s performance but urged caution. “While these numbers are excellent, it’s too early to call this a full-scale recovery for the luxury sector,” he noted.
Industry watchers are now turning their attention to upcoming earnings reports from key players, including LVMH on January 28, followed by Gucci-owner Kering and Birkin bag maker Hermès in February. The luxury market has been facing its slowest growth in years as economic uncertainties and high prices impact consumer spending. However, ultra-premium brands like Hermès continue to outperform, widening the gap between industry leaders and those catering to a broader clientele.
As the luxury sector navigates an evolving landscape, Richemont’s strong quarter offers a glimmer of optimism for high-end brands seeking resilience in a challenging market
