Watches of Switzerland has eye on second-hand market

2 mins read

Watches of Switzerland, a luxury watch retailer known for selling brands like Rolex, Piguet, and Cartier, has unveiled plans to more than double its annual profits by fiscal year 2028. This ambitious goal is driven by the company’s growth in the United States and its expansion into the flourishing second-hand luxury market.

In response to this announcement, shares in the luxury retailer surged by as much as 14% during early trading. The company’s move comes as it seeks to reassure investors after Rolex’s acquisition of retailer Bucherer in August raised concerns about its future prospects.

Watches of Switzerland reported a 5% increase in quarterly revenues at constant currency, with a significant boost from an over 80% surge in sales of pre-owned luxury products. While challenges such as a slowdown in China and uncertainty related to interest rates in Europe and the United States have weighed on the share prices of luxury retailers, there has been a notable increase in both buyers and sellers in the second-hand luxury goods market, benefiting companies like Watches of Switzerland.

CEO Brian Duffy expressed enthusiasm about the company’s prospects in the pre-owned market, particularly through the new Rolex Certified Pre-Owned program. He expects this program to account for 20% of new Rolex sales in the U.S. and 10% in the UK by fiscal year 2028.

Watches of Switzerland has set its sights on achieving group sales exceeding £3 billion ($3.69 billion) by the end of fiscal year 2028. Analysts at RBC Capital Markets noted that the company’s long-term revenue and profit plans exceeded market expectations.

Duffy also highlighted the company’s growth potential in the luxury branded jewellery market, expecting it to contribute a significantly larger share of total revenue as the company expands in the United States and leverages partnerships with U.S. mega-brands.