Swiss watchmaker Swatch Group reported a sharp drop in performance for the first half of 2025, with sales down 7.1% year-on-year to 3.06 billion CHF ($3.46 billion) and net profit plunging to 17 million CHF ($19 million) from 147 million CHF ($166 million) a year earlier.

The company directly attributed the decline to weak demand in mainland China, Hong Kong, and Macau. Wholesale revenue in Greater China fell over 30%, while sales at directly operated stores dropped 15%. The region’s share of total sales declined from 33% to 24% over the past 18 months. The downturn also affected nearby Asian markets reliant on Chinese tourist spending, though Swatch noted signs of recovery in local e-commerce and inventory levels.

In contrast, the Americas posted strong gains, with U.S. sales for brands such as Omega, Longines, Tissot, and Rado rising 10–30%. However, potential U.S. tariffs of up to 31% on Swiss watches could dampen future growth.

Despite falling sales, Swatch chose not to cut jobs or reduce capacity, citing its vertically integrated production model. The group is investing at both ends of the market, launching high-end and entry-level innovations such as Omega’s ultra-thin Aqua Terra, Breguet’s 250th-anniversary model, and an AI-customization platform, “AI-DADA,” from Swatch targeting Gen Z.