Updated 2:43 p.m. ET on July 16
LONDON — What’s more durable than a billion-year-old diamond? Diamond jewelry, especially if it comes out of a Richemont box and the price is right.
In the thick of a luxury slowdown, Richemont’s jewelry brands posted their third consecutive quarter of double-digit growth, climbing 11 percent at constant exchange and 7 percent at actual rates to 3.91 billion euros in the three months to June 30.
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Jewelry and watch sales at Cartier, Van Cleef & Arpels, Buccellati and the recently acquired Vhernier accounted for more than 70 percent of Richemont’s revenue in the first fiscal quarter of 2025-26, outshining the other divisions despite rising gold prices, fluctuating exchange rates and volatile times.
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Richemont’s overall sales rose 6 percent at constant exchange, and 3 percent at actual rates to 5.4 billion euros, sending the share price up a modest 1 percent to nearly 150 Swiss francs, or around 160 euros.
The results drew praise — and sighs of relief, no doubt — from the European analysts, who by now have become accustomed to downbeat news from the big luxury groups.
Citi’s Thomas Chauvet said the sales momentum at Richemont “continues to impress,” while Deutsche Bank argued that the ongoing brand and category heat around Richemont jewelry “will likely keep it as the standout luxury performance for this quarter.”
Luca Solca of Bernstein noted that the 11 percent uptick in jewelry outstripped already “punchy” consensus estimates of 9 percent. Wan Nurhayati, an equity analyst at CFRA Research, said Richemont continues to weather the broader luxury slowdown more effectively than peers “thanks to the resilience of jewelry brands like Cartier and Van Cleef & Arpels.”
Richemont attributed the uptick in jewelry sales to higher tourist spend and “robust” demand from local clients and tourists alike. It also credited “successful high jewelry events,” such as Cartier’s “En Équilibre” multiday showcase in Stockholm, during the quarter.
Certain regions were also in the mood to spend. Sales in Europe were up 11 percent at constant and actual rates, with almost all main markets in the region seeing an increase in sales, with “notable performances” in Italy and Germany, Richemont said.
The Americas rose 17 percent at constant rates and 10 percent at actual ones, driven by “supportive local demand across all business areas and markets,” while sales in the Middle East and Africa region rose by 17 percent, led by the United Arab Emirates.
The unwavering success of the jewelry maisons also comes down to a strong value proposition. Richemont has a disciplined approach to price, a strategy that comes straight from the founder and chairman Johann Rupert.
In May, during Richemont’s full-year results presentation, Rupert said he is loath to raise prices drastically — anywhere — for fear of damaging the relationship with the local customer.
“We were not greedy in the post-COVID-19 boom period. And I think our resilient results [in fiscal 2024-25] prove that we have not suffered the revenge of our clients. Our goal is to continuously keep the value relationship for our clients,” Rupert said.
He added that if Richemont hikes its prices too much, it risks “discriminating against” its loyal local clients. “We have to be sensitive to the loyal local clients, and we will not make sudden, rapid increases.”
Cartier raised its prices in May, but only slightly. According to Morgan Stanley, the increases were lower than expected and ranged from zero in the U.K. to 5 percent in South Korea. The aim was to offset input costs, such as the price of gold; U.S. tariff increases, and foreign exchange fluctuations.
Rupert is a big believer in the intrinsic value of jewelry, and an advocate of “fair” global pricing, in order to avoid situations where clients will travel to buy a product that’s cheaper in a certain market.
While jewelry was the star of the first quarter, Richemont’s specialist watch division — which has been struggling for a while along with the wider industry — showed some improvement.
Sales declines “softened” to minus 7 percent at constant rates and minus 10 percent at actual ones. The declines reflected continued lackluster demand in China, Hong Kong and Macau, and a downturn in Japan. Sales in the division were partly offset by double-digit growth in the Americas.
Sales at Richemont’s “other” division, which includes the fashion and accessories brands as well as the Watchfinder & Co. resale platform, were down 1 percent at actual rates and 4 percent at constant exchange.
Richemont said there was “solid momentum” at Peter Millar and Alaïa, an encouraging performance at Chloé and “robust growth” at Watchfinder & Co. in the three-month period.
Asia-Pacific continues to lag, due chiefly to China. Sales in the region were down 4 percent at actual rates, with a 7 percent decline in China, Hong Kong and Macau offset by strong growth in almost all other markets. Sales in Australia and South Korea were up in the double digits.
In Japan, sales declined by 15 percent against a demanding 59 percent comparative in the prior-year period, with a strengthening yen “strongly reducing” tourist spend, most notably from Chinese clientele, Richemont said. Local demand remained positive.
Richemont’s net cash position on June 30 stood at 7.4 billion euros compared with 7.3 billion euros after accounting for the 426 million euros cash-out upon completion of the sale of YNAP to Mytheresa in April.