Richemont posts surprise double-digit sales jump for golden quarter, but China still weak

Swiss luxury group Richemont has beaten market expectations for Q3 sales with the owner of Chloé, Alaïa, Dunhill, and Cartier on Thursday reporting results that offered some good signs for the luxury sector recovery.

Sales jumped 10% year on year at both constant and actual exchange rates, hitting €6.2 billion for the final three months of the calendar year against analyst expectations of just a 1% rise.

Those were record sales and more than hinted at a bounce-back in the luxury segment that had seen a sluggish 2024 overall. However, the company said sales in China — which was once luxury’s key driver — fell 18% and the market there is “still challenging”.

But the Americas, Europe, the Middle East/Africa and Japan saw growth of 10%+, helping to cushion the shock of the fall in China. Europe was up 19% at €1.456 billion while the Middle East and Africa rose 21% to €542 million. The Americas increased 22% to €1.647 billion. And while Asia Pacific overall still declined, the drop was slower. It fell 7% this time to €1.913 billion.

The company highlighted the “marked improvement over H1 across all business areas”, driven by an acceleration at its Jewellery Maisons with a 14% rise to €4.5 billion, and its ‘Other’ business that was up 11% at €782 million. ‘Other’ includes the Fashion & Accessories Maisons, which rose 7%, “thanks to continued progress at Alaïa and Peter Millar, as well as the added contribution of Gianvito Rossi”. But the Specialist Watchmakers were down 8% at €867 million, topping off an extended weak period for the sector and dragged down by Asia-Pacific.

Richemont said its channel performance was strong with retail up 11% at constant and actual exchange rates. That’s good news given that retail is its largest channel, accounting for €4.382 billion worth of sales. 

Online retail is much smaller at €419 million. But regardless of its smaller size it was impressive and managed a 17% increase at constant rates and an 18% rise at actual rates. Wholesale and royalty accounts for €1.349 billion worth of sales and rose 4% at both actual and constant rates.

It also said its nine-month sales of €16.2 billion, were up 4% at constant rates and 3% at actual exchange rates, underlining how weak the luxury sector was earlier in the year.