Swatch Profit Plummets in H1 as Sales Shrink by 11%

Swatch profits in free fall. The Swiss watchmaking group has announced a plunge of 88.4% in net income for the first half of this year, compared to the same period last year. The company posted a net profit of 17 million Swiss francs ($21,2 million).

The company has shrunk its sales by 11.2% to 3,059 million Swiss francs ($3.81 billion at the exchange rate), while in the first half of 2024 had a turnover of 3,445 million Swiss francs ($4.29 billion), according to data released by Swatch on Thursday.

Its operating profit also fell by 66.66% to 68 million Swiss francs ($84.4 million). In the same period of the previous year, the company recorded 204 million Swiss francs ($254 million). Profit before taxes plummeted by another 68%, from 72 million Swiss francs ($89.8 million) to 225 million Swiss francs ($280 million).

Swatch shrank its sales by 11.2% to 3,059 million Swiss francs ($3.81 billion)

Swatch assures that the drop in sales is “exclusively attributable to China” where, however, it expects an improvement in the second half of the year, due to an eventual increase in consumption. Its wholesale plummeted in the territory by more than 30%, while its own stores held up better, shrinking by half, 15%. China has gone from accounting for 33% of the group’s total sales to 24% in the last 18 months.

Swatch says sales have grown by double digits in the United States, Mexico and Canada, with Omega, Longines, Rado, Tissot and Hamilton performing well. India posted 20% year-on-year sales growth and Japan, however, stagnated. In Switzerland, sales fell and the other European markets remained the same. The company highlights the performance of electronic systems, with a 20.3% increase in sales.

As for its forecasts, Swatch expects the United States, Japan and India to grow and to increase its production capacity in the face of new launches.