Well-heeled Americans are still buying luxury Swiss timepieces despite price increases caused by US President Donald Trumpâs tariff war, according to Watches of Switzerland Group Plc.
âThe US has been the standout performer, with sales up 20 percent in constant currency, driven by broad-based growth across brands and categories throughout the period,â Chief Executive Officer Brian Duffy said in a statement reporting interim sales that beat expectations.
Watches of Switzerland is the largest authorised seller of Rolex watches in the UK and has a big and growing presence in the US. It reaffirmed its fullâyear outlook Thursday, driven in large part by the strong US performance.
Shares of Watches of Switzerland were up 6 percent in London as of 11.02 a.m. Still, the stock is down about 26 percent since the start of the year as the US imposition of a 39 percent tariff on Swiss imports has weighed on the luxury watch industry.
Many of the companyâs core clientele are often on waiting lists for the most in-demand watches and tend to be less susceptible to price increases and economic pressures, said Duffy in an interview. However, he said he is closely monitoring the situation as several watch brands did push through price increases in September and October, âso itâs still early days.â
âThe past semester has seen remarkable US revenue progress, with price inflation an effective and timely offset to mounting tariff challenges,â said Jefferies analyst James Grzinic. Whether Swiss trade negotiations will help achieve a reduction in the punitive tariff rate âwill remain an important swing factor for the shares,â he added.
In the UK, likely tax increases coming in the Chancellor of the Exchequer Rachel Reevesâ budget announcement will not be good for consumer confidence, said Duffy. Although higher-priced offerings have always performed well in the US, the UK market is more receptive to value-oriented products. Product introductions involve a bit more steel, less gold and fewer chronographs, said Duffy.
By Allegra Catelli
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