Swatch FY operating profits fall short of market expectations

30th Jan 2026 08:19

(Sharecast News) - Swiss watchmaker Swatch Group fell short of market expectations for full-year operating profits, with results held back by low capacity utilisation and its decision to keep factories running in anticipation of future demand.

Swatch posted underlying earnings of CHF 135m (£127.69m), well below the CHF 201.3m (£190.36m) forecast, as it said its production division had delivered a strongly negative result after it opted to retain capacity and jobs without seeking compensation for reduced working hours. Operating margins came in at 2.1%, also short of the 3.4% analysts had pencilled in.

However, Swatch said its sales performance was more encouraging, rising 4.7% at constant exchange rates in the second half, supported by a strong fourth quarter. Full‑year revenues edged up to CHF 6.28bn (£5.86bn), slightly ahead of expectations.

Across its operating regions, Swatch said sales rose 3.4% for the year and 8.2% in the second half, excluding China, Hong Kong and Macau. It also noted that Swiss watch exports declined in 2025, according to industry data, but highlighted particularly strong growth in the Americas, where sales increased nearly 20% despite Swiss exports to the US being hit with a 39% tariff from early August until mid‑November.

As of 1005 GMT, Swatch shares were up 5.89% at CHF 170.85 each.

Reporting by Iain Gilbert at Sharecast.com