As stock prices soar to all-time highs, demand in the luxury watch market remains stable through booms and busts from 2021 to 2022. Especially in the US.
UK-based jeweler Watch of Switzerland, which has a growing retail presence in the US, said last week that its US sales rose 14% in its fiscal fourth quarter, giving the retailer better-than-expected results. announced that it had been achieved.
The company's stock price rose 10% on the news.
Watches of Switzerland CEO Brian Duffy said on a conference call with analysts that U.S. sales were “particularly strong” and described the U.S. market as “untapped.” Stated.
David Hurley, deputy chief executive officer and head of the Americas at Watches of Switzerland, said in an interview with Yahoo Finance that two retailers in New York City, a market the company didn't enter until 2019, have He said he made $100 million in revenue in one year. The company had sales of $880 million in the United States during the same period.
The company's main driver is Rolex sales, particularly through its certified pre-owned (CPO) program. The company announced that total used and vintage Rolex revenue, including CPO, doubled in the fourth quarter of its fiscal year compared to the same period last year.
Watches of Switzerland's strong performance comes as prices for luxury watches, including Rolex watches, continue to be weak. Rolex prices have fallen nearly 10% since last year, according to data from WatchCharts, which tracks the street prices of Swiss luxury watches. Overall luxury watch prices fell 12% over the same period.
Prices for luxury watches peaked in spring 2022.
what is old becomes new again
Used watches are currently the second largest category of watches in Switzerland.
CPO sales also help retailers alleviate the eternal problem of Rolex sales, especially supply.
Hurley said Rolex's CPO business has been “very successful” and that the company's entry into the U.S. market last year contributed “100%” to the industry's overall performance.
“It just gives people more confidence and will definitely help grow the secondary market overall,” Hurley said.
The company told analysts last week that growth in the sector is “exponential” and that Rolex CPO sales could approach 20% of the company's revenue by the end of next year.
CEO Duffy told analysts that the company “continues to be pleased with the support we're getting for the projects we're working on and what's happening across the market.”
Projects that involve continued growth, especially in the US market.
“If you look at the broader watch market, the U.S. is probably the most stable market,” Hurley said.
“I think over the last five to six years all brands have recognized the growth capacity and capacity of the U.S. market. So retailers are investing and all brands are investing behind it as well.”
Hurley also said that retailers like Swiss Watches, which are spending a lot of money on “monobloc” stores (such as Rolex's new standalone store in Atlanta), “are going to benefit from the support that we're going to get from us.” He pointed out that he would not make such an investment unless he had some understanding of the A major watch partner. ”
Suggesting Swiss watches has some indication as to the number of units sold. The company keeps numbers close to the vest.
And Duffy told analysts that the company's stance is that it is “never satisfied with the allocation” it receives from Rolex, adding that “demand continues to significantly outstrip supply.”
Pras Subramanian is a reporter for Yahoo Finance.you can follow him twitter And even more Instagram.
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