Richemont Shares Drop After Cartier-Parent's Sales Growth Loses Some Shine

By Andrea Figueras

Richemont shares slid after the Swiss group reported a deceleration in sales growth for its most recent quarter at a time when the luxury sector continues to grapple with feeble demand.

The owner of jewelers Cartier and Van Cleef & Arpels said Friday that sales for its fiscal second quarter through September climbed 13% from the same period a year earlier at constant exchange rates. The group's growth engine, its jewelry business, booked a 14% rise in sales. Both growth rates slowed compared with the respective increases of 20% and 24% recorded in the prior quarter.

Zurich-listed shares traded 5% lower in midday trading, recovering from declines of as much as 9% earlier.

Richemont closes a volatile and generally downbeat luxury reporting season, analysts at Citi wrote in a research note. Despite a solid sales performance, there are lingering concerns about a normalization in jewelry sales growth, the analysts said.

Hopes of a recovery in demand for luxury goods have faded in recent weeks as major players, including Paris-based industry leader LVMH, reported weak sales, hurt by a gloomy consumer backdrop in the key Chinese market.

Growth in China will come back, but the timing of a recovery there remains unknown, Richemont Chairman Johann Rupert said during an earnings call.

Despite the challenging market context, Richemont has been benefiting from the resilience of jewelry demand.

High-end jewelry targets the most affluent consumers, a segment that is less affected by economic difficulties. In contrast, companies that sell items such as handbags, apparel and footwear--and that are exposed to less wealthy shoppers--are facing greater pressures, as their customers shy away from spending money on luxuries.

"Richemont delivered strong results in a volatile geopolitical and macroeconomic environment," Rupert said, adding that this uncertain backdrop is expected to continue in the foreseeable future.

Analysts at Bernstein argued that the company delivered "an excellent performance" relative to some of its rivals and "continues to be head and shoulders above the rest of the major luxury peers."

The watches division, which experienced soft demand in recent years, recorded a sales increase of 12%. The segment's double-digit rise, coupled with "stunning profitability" at the group level, is the key positive surprise, Vontobel's Jean-Philippe Bertschy said.

The operating margin expanded 330 basis points to 25.5% in the first half, while gross margin stood at 66.5%, versus 65.3% previously.

Net profit for the six-month period jumped to 2.53 billion euros ($2.80 billion) from 1.8 billion euros.

Despite the current difficulties, Chief Executive Officer Nicolas Bos said he remains confident in the long-term demand for both jewelry and watches.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

November 13, 2026 07:18 ET (12:18 GMT)