By John Meyer, consultant in financial affairs – Eurasia Business News, November 9, 2024. Article No 1296.

Richemont, the owner of Cartier, has reported a 1% decline in sales for the second quarter of its fiscal year, totaling €10.1 billion ($11 billion). This drop is primarily attributed to ongoing economic challenges in China, where sales fell significantly due to reduced consumer spending.

Key Financial Highlights:

Net Profit Decline: Richemont’s net profit for the first half of the year decreased by 20%, amounting to €1.7 billion ($1.8 billion), which was lower than analyst expectations.

Sales Breakdown: Sales in the Asia-Pacific region dropped nearly 20%, overshadowing solid growth in other regions, particularly in the Americas, which saw double-digit growth.

Operating Profit: The operating profit from continuing operations fell by 17%, reflecting the impact of decreased sales and ongoing investments in the company’s long-term growth strategies.

Market Context:

This decline in Richemont’s sales mirrors broader trends in the luxury market, particularly among major players like LVMH and Kering, both of which have also reported significant drops in sales due to similar pressures from the Chinese market. 

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The luxury sector is facing challenges as consumer confidence wanes amid economic uncertainty in China, which is a critical market for luxury goods.

In summary, Richemont’s latest financial results highlight the ongoing struggles within the luxury sector, particularly influenced by economic conditions in China.

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© Copyright 2024 – Eurasia Business News. Article no. 1296