Watches of Switzerland Sees Strong Trading Amidst Market Challenges

Watches of Switzerland Group (WOSG) recently provided an encouraging update on its trading performance, signalling a positive shift after a challenging period that saw its share price decline significantly. The luxury watch retailer reported good news concerning its core UK and US markets, demonstrating resilience despite recent tariff impacts and the ongoing debate surrounding VAT-free shopping for tourists in the UK.

The company expressed satisfaction with its performance for the 18 weeks ending August 31, 2025, confirming it is well on track to achieve a strong H1 FY26 in line with its expectations. WOSG noted consistently robust trading throughout this period, with particular strength observed in the US market, even in the face of announced increased tariffs on Swiss imports. The stability previously seen in the UK luxury watch and jewellery markets during H2 FY25 has continued, contributing to healthy year-on-year growth. Furthermore, Registration of Interest lists for desirable products continue to expand in both key markets.

A standout success highlighted by WOSG is the flagship Rolex Boutique located on Old Bond Street, London. This location is reportedly exceeding all expectations, with excellent client response, high traffic levels, and strong conversion rates. The lower ground floor's Rolex Certified Pre-Owned salon is rapidly establishing itself as a premier destination for Rolex enthusiasts, underscoring the powerful combination of a prestigious Bond Street address and the iconic Rolex brand, even as London's shopping tourism remains affected by the absence of VAT-free shopping.

Beyond its physical stores, WOSG's e-commerce sales have also shown impressive growth, particularly in the US, following a successful upgrade to its signature webstore. Additionally, the group's "well-established" Certified Pre-Owned (CPO) business is expanding effectively across both the UK and US markets, with management identifying significant further growth opportunities within this dynamic category.

The strategic acquisition of Roberto Coin Inc in May 2024 is also performing strongly. WOSG has outlined plans to further grow and develop the Roberto Coin brand, including the launch of a high-profile campaign featuring Dakota Johnson as its global brand ambassador, indicating a clear intent to elevate this segment of its portfolio.

Looking at the broader WOSG business, the strategy of "elevation and brand expansion within our own showrooms" is proving highly successful. The company is continuously refining its offerings and sees potential to extend these successful concepts to its retail partners. Significant expansion plans are underway, including signed leases for three new monobrand boutiques. Construction of newly designed boutiques in key US cities – Miami, New York, and Las Vegas – is progressing, with openings anticipated in Q3 of its 2026 financial year, meaning before the end of November 2025.

Showroom development remains a core focus. Recent activities include the successful refurbishment of Northern Goldsmiths in Newcastle, a site that has retailed Rolex since 1919. WOSG also opened the Audemars Piguet AP House in Manchester as a joint venture. Furthermore, the new Mappin & Webb Luxury Jewellery Boutique in Manchester has just been completed and opened, offering geographical exclusivity for several luxury jewellery brands, notably including WOSG’s first De Beers monobrand boutique.

Internationally, the relocated Mayors Lenox store in Atlanta opened last month, building on the encouraging starts seen from Q4 FY25 openings of Mayors Jacksonville, Florida, and Watches of Switzerland Plano, Texas – the group's inaugural showroom in the state. For the current financial year, further showroom developments and openings are planned, including a new Watches of Switzerland in Southdale, Minneapolis, and the relocation of Mayors University Town Center in Sarasota, Florida. In the UK, WOSG will complete the Mappin & Webb Birmingham conversion, relocate Goldsmiths Merry Hill in Birmingham, and expand Goldsmiths Oxford.

While this extensive activity and substantial investment are evident, WOSG did not disclose specific monetary figures regarding profitability impact in its Wednesday outlook. However, the company confirmed that performance in both markets is encouraging and aligns with the FY26 guidance provided in July 2025. Importantly, WOSG does not anticipate any material impact from the US tariffs in H1 FY26, attributing this to brand partners having increased inventories, a trend supported by Swiss Watch Export figures in July 2025 showing a 45% increase year-on-year.