Swiss watch exports return to positive 12-month growth as Greater China improves

Overview

This industry update assesses August Swiss watch export data and Bernstein's implications for global luxury goods. It finds that the export cycle is gradually improving, led by a return to positive 12-month growth globally and in Greater China, although regional demand patterns remain uneven and macro risks could slow the recovery.

Core views

Swiss watch exports increased 9.1% year on year in August 2026. Bernstein estimates that growth would have been about 4.1% after adjusting for one additional working day. More importantly, global export value rose 0.2% year on year on a 12-month moving-average basis, turning positive for the first time in two years. The institution treats the rolling measure as a clearer read on the underlying trend than volatile monthly shipments and concludes that demand is moving into a gradual recovery. The US remained volatile on a monthly basis: export value fell 19.4% year on year in August, compared with growth of 26.5% in July, despite an easier comparison base. Bernstein believes this mostly reflects the timing of sell-ins rather than a sharp deterioration in end-demand. On a 12-month moving-average basis, US export-value growth improved from negative 21% in April 2026 and had stabilized at negative 17% since June. The report cites Watches of Switzerland's first-quarter 2027 trading update as evidence of continued, broad-based US demand resilience. Greater China improved sharply in the month but remains a fragile recovery. Exports to Mainland China rose 15.8% year on year, versus a decline of 18.5% in July, while Hong Kong grew 1.4%, versus 0.5% previously; both movements benefited from easier comparison bases. On a 12-month moving-average basis, regional exports rose 0.8% year on year, the first positive reading since April 2024. European Union export growth also held up at 12.8%, led by France at 113.5%, Germany at 34% and the UK at 46.1%, more than offsetting declines in Italy of 40.4% and Spain of 38%. Easier comparisons supported sequential improvement in most price categories. Watches below CHF200 recorded growth of 14.9% in volume and 13.3% in value; watches above CHF3,000 rose 2.6% and 10.2%, respectively; and the CHF200-500 segment rose 7.4% and 6.1%. The CHF500-3,000 segment was the exception, falling 1.9% in volume and 0.9% in value. Total export volume accelerated to 4.5% year-on-year growth on a 12-month moving-average basis in August from 2.6% in the prior month, with improvement across price segments. By material, gold-steel watches continued to lead: export value rose 20.1% year on year in August and 12-month moving-average growth accelerated to 14.5% from 11.8% in July. Other metals were the only other category to turn positive on a rolling basis, at 5.2%, with 3.7% August growth. Precious metal, steel and other-material watches remained negative on a 12-month basis at negative 2.8%, negative 4.3% and negative 1.3%, respectively, despite positive August growth of 6.9%, 2.8% and 31.9%. For luxury equities, Bernstein says it remains comfortably exposed to Richemont as its best idea, expecting its organic-growth premium to persist beyond consensus expectations of normalization. It sees Hermès improving its ability to win at the high end during FY27E. It says LVMH is benefiting from a Dior revival but remains constrained by weak aspirational middle-class demand, and expects further price/mix adjustment at Louis Vuitton. Bernstein views Kering's Gucci pricing and mix adjustments as evidence that repositioning can help even without a major aesthetic reinvention. The overall recovery thesis is tempered by risks from higher oil prices, inflation and a possible return of tariff-related disruption.

Analysis framework

Bernstein compares monthly Swiss watch export data with prior-year levels and uses 12-month moving averages to distinguish underlying demand trends from shipment timing and base effects. It then breaks the data down by destination market, price segment and material, and links the sector read-through to its stated views on selected luxury companies.

Methodology notes

• Industry AnalysisVolume-price decomposition

  Export performance is separated into volume and value growth across watch price bands and materials.

  This shows whether improvement is broad-based and whether it reflects more units shipped, higher-value shipments, or both.

• Industry AnalysisSupply-demand framework

  The report uses regional export trends and retailer commentary to assess the direction of Swiss-watch demand.

  Monthly exports are interpreted alongside sell-in timing, comparison bases and a rolling 12-month measure to judge the recovery's durability.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Richemont

  Bernstein identifies Richemont as its best idea within the luxury sector.

  Strengths

  The report expects its organic-growth premium to persist beyond consensus expectations of normalization.

  Risks

  Sector recovery remains exposed to macroeconomic, inflation and tariff-related risks.

• Hermès

  Soft-luxury beneficiary of high-end market positioning.

  Strengths

  Bernstein sees an opportunity for the mega-brand to improve its ability to win in the high end.

• LVMH

  Luxury group linked to the report's discussion of brand and price/mix strategy.

  Strengths

  The report says LVMH is benefiting from a Dior revival.

  Weaknesses

  It remains affected by weak aspirational middle-class demand and lackluster Fashion & Leather Goods organic growth.

  Comparison

  Bernstein expects LVMH to move further toward Kering-style price/mix adjustment, with more safeguards for Louis Vuitton brand equity.

• Kering

  Example of luxury-brand repositioning.

  Strengths

  The report says Gucci demonstrated that price/mix adjustment can help.

  Comparison

  Its Gucci experience is used as a reference point for potential Louis Vuitton price/mix changes.

Key data

• August 2026 Swiss watch export growth+9.1% YoYApproximately +4.1% after adjusting for one additional working day.
• Global export value, 12-month moving average+0.2% YoYFirst positive reading in two years.
• Greater China export value, 12-month moving average+0.8% YoYFirst positive reading since April 2024.
• US export value-19.4% YoYVersus +26.5% in July 2026; Bernstein attributes monthly volatility largely to sell-in timing.
• EU export value+12.8% YoYVersus +12.4% in July 2026.
• Gold-steel watch export value, 12-month moving average+14.5% YoYAccelerated from +11.8% in July 2026.

Impact & implications

Bernstein interprets the data as supporting a slow normalization in Swiss watch demand rather than a rapid rebound. The US remains an important support market, Greater China has crossed a meaningful rolling-growth threshold but is still fragile, and the strength of gold-steel watches highlights uneven recovery across product categories.

Risks

• Higher oil prices and inflationary pressures could threaten the industry's gradual recovery.
• A re-emergence of tariff-related disruptions could slow the recovery.
• The Greater China recovery remains fragile despite the return to positive 12-month export growth.