Richemont group's Q1 sales exceed expectations with strong demand for high-end jewelry

Swiss luxury goods group Richemont released its financial results for the fiscal year ending in March 2026, with a year-on-year increase in total sales of 11% at constant exchange rates, exceeding the 9.78% expected by Bloomberg analysts.

In the first quarter of this year (the fourth fiscal quarter), the quarterly sales reached €5.4 billion (approximately $6.27 billion), with a year-on-year increase of 13% at constant exchange rates, also slightly exceeding market expectations. Strong demand for jewelry brands such as Cartier and Van Cleef & Arpels led to a 16% increase in core jewelry business sales on a quarterly basis.

Against the backdrop of an overall downturn in the luxury goods industry and the further suppression of high-end consumer demand due to the Iran war, this report stands out. LVMH, Kering, and Hermès all reported lower than expected sales in the first quarter, while Richemont's stock price fell about 9% during the year. In comparison, LVMH's decline was as high as 27%, showing a clear industry divergence.

The "hard currency" attribute of jewelry serves as a moat

The resilience of Richemont largely stems from the uniqueness of its business structure. Compared to high-priced clothing and leather goods, fine jewelry is more often regarded as a means of value storage by consumers and is more resilient during times of economic uncertainty. The continued popularity of Cartier bracelets and rings is a direct reflection of this logic.

However, Richemont is not immune to geopolitical shocks. UBS analyst Zuzanna Pusz estimates that the Middle East region contributes about 9% of its revenue, and the Iran war has already affected sales in high-end shopping centers like Dubai. Richemont also stated in its performance statement that it expects uncertainties to continue, with the Middle East situation remaining a major risk variable.

At the beginning of this year, the market collectively expected the luxury goods industry to emerge from a multi-year slump, but this optimistic expectation vanished with the outbreak of war. Richemont's jewelry-centric business structure has temporarily placed it in a more advantageous position amidst industry headwinds—but if the conflict prolongs, the continuous absence of the Middle Eastern customer base will eventually become an inescapable pressure.