In a new trading update, Watches of Switzerland Group has detailed a “particularly volatile” festive period, with consumers turning away from the luxury sector to shop in categories such as fashion, beauty, hospitality and travel.
Watches of Switzerland Group noted that despite a positive start to the early part of Q3 FY24, it then experienced a volatile trading performance in the run-up to and beyond Christmas, as challenging macro-economic conditions impacted consumer spending in the luxury retail sector. The business now expects these challenging conditions to remain for the balance of its fiscal year.
While sales in the US remained strong with continued double-digit growth, the UK was more challenged. This impacted a broad range of luxury watch brands and non-branded jewellery.
In light of the recent challenging trading conditions and based on a more cautious view of the outlook for the remainder of the fiscal year, Watches of Switzerland Group is revising its full year guidance for FY24, which assumes no recovery in consumer demand.
Brian Duffy, Chief Executive Officer, said: “The festive period was particularly volatile this year for the luxury sector, with consumers allocating spend to other categories such as fashion, beauty, hospitality and travel. Whilst we are disappointed with this trend, we are encouraged by our market share gains in both the US and UK.
“I would like to thank our colleagues for continuing to provide high quality service and support to our clients against this challenging backdrop. We remain confident in the markets in which we operate, our model and the delivery of our Long Range Plan announced to the market in November 2023.”
