August marked a fourth straight month of growth for Swiss watch exports, according to the Federation of the Swiss Watch Industry on Thursday. Gains in shipments to China, Japan and Singapore helped offset a sharp pullback in the US, lifting overall export values by 9.1% year over year. Consequently, the rolling 12-month trend posted its first above-zero reading in two years.
Vontobel analyst Jean-Philippe Bertschy noted that volumes for midrange and higher end watches lagged cheaper models, underscoring a market still under pressure from tariffs and geopolitical tensions that have crimped luxury demand. "Regionally, the data were exceptionally volatile," Bertschy said, adding that the US decline supports the view "that the market is still distorted by tariff-related inventory movements and tough comparison bases."
Timing matters here. August is pivotal for third quarter results because China's Valentine's Day lands on Aug. 19. Even so, global luxury brands are dealing with a worsening sales slump in China as the economy slows, authorities crack down on conspicuous consumption, and a push to tax offshore wealth ripples from stock markets to casino floors, squeezing spending by the wealthiest consumers. As Bertschy put it, "One positive month is insufficient to establish a sustainable recovery, particularly in light of renewed concern around Chinese consumer demand."
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The takeaway for everyday investors is simple enough. Momentum is improving, but the market backdrop - especially around China - is still shaky, and the mix is shifting toward lower priced pieces. If you own or watch companies tethered to luxury demand, that combination can make quarterly results bumpy.
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