Swatch — the parent of Longines, Omega, and Tissot — is seeing sales slump, and it’s because of China

Swatch saw its profits slide 75% in 2024 compared to the year before. 

Swatch reported weak sales and a major slump in operating profits in 2024, owing largely to weak demand from Chinese consumers.

The luxury watch group, which owns watch big league brands like Omega, Tissot, and Longines, saw its sales decline 12% and its profits drop about 75% last year.

In the earnings press release published on Thursday, the group posted net sales of 6.7 billion francs, or $7.4 billion. This was a 12.2% decline from 2023 when it earned 7.9 billion francs.

Its operating profit dropped about 75% from about 1.2 billion francs in 2023 to 304 million francs in 2024.

The group attributed the results to a “persistently difficult market situation and weak demand for consumer goods overall in China.”

Swatch’s press release said sales in China, including Hong Kong and Macau, slid around 30% in 2024.

It also added that there was a “huge drop in demand for consumer goods” in Southeast Asian markets, which it said are “heavily dependent on Chinese tourists.”

However, it reported stronger sales in other key markets, such as the US, Japan, India, and the Middle East. It said that in the US, Tissot sales exceeded $100 million for the first time.

Overall, luxury Swiss watchmakers struggled with weak demand in 2024. In September, Bloomberg reported that Girard-Perregaux and Ulysse Nardin, Swiss luxury watch brands owned by Sowind Group, turned to the government for financial support to cope with low demand.

Meanwhile, the Rolex resale market has also been cooling for more than two years after its COVID-era high, owing partly to a surge of watches coming into the market.

A bad year for luxury goods

Watches are not the only luxury products impacted by waning demand in China.

In 2024, overall luxury spending stagnated, and big brands saw their share prices drop. Kering, the owner of Gucci, YSL, and Balenciaga, saw its stock fall more than 40% last year.

And luxury conglomerate LVMH’s sales declined by 3% in the third quarter of 2024, partly because of weakened consumer confidence in China.

Representatives for Swatch did not respond to a request for comment from B-17, sent outside regular business hours.