Watches of Switzerland expects solid annual operating profit on strong US growth

Thu, 14th May 2026 08:49

* US market drives 24% revenue growth, accounts for over half of group sales

* Company sees minimal direct exposure ‌to Middle East conflict

* Monitors potential impact on consumer sentiment

* Operating profit outlook for 2025/26 exceeds analyst estimates

May 14 (Reuters) - Watches of Switzerland expects annual operating ⁠profit above market expectations, it said on Thursday, driven by robust demand for luxury watches such as Rolex and TAG Heuer in the United States, its biggest market.

Shares of the London-listed company jumped nearly 12% to 593.50 pence in ‌early trading.

The seller of Patek Philippe and Audemars Piguet among other high-end watches has benefited from a recovery in the U.S. after a few years of soft spending on luxury goods.

It expects to report operating profit between 152 million and 155 million pounds ($205 million and $210 million) for the fiscal year ended May 3, above the 148.2 ‌million pounds expected by analysts in a company-compiled poll.

U.S. revenue grew 24% in constant currency to $1.24 billion and now accounted for over ‌half of group sales, CEO Brian Duffy said in a trading update statement. The company reports full-year results on July 14. The United States overtook Britain as the group's biggest revenue contributor as demand recovered faster among affluent American shoppers, as a surge in U.S. stock markets ‌boosted consumer sentiment.

"The higher income cohort in the U.S. is clearly feeling good about their wealth, and therefore, the positive consumer sentiment around that clearly is benefiting the luxury watch and jewellery ⁠category and ⁠we see that continuing into this year," Duffy told ‌Reuters in an interview.

Watches of Switzerland said it had minimal direct exposure to the Middle East but was monitoring the situation and its effect on broader consumer sentiment.

It forecast 2026/27 sales ‌to grow between 5% and 10% on a constant currency basis, marking a slowdown from the 13% rise it recorded in the previous fiscal year.