Half-year report 2025Download PDF (416.03 KB)

P

RESS RELEASE | AD HOC

Ad hoc announcement pursuant to Art. 53 of the Listing Rules

• Net sales of CHF 3 059 million, -7.1% against the previous year at constant exchange rates and on a comparable basis1) (-10.4% at current rates). Negative currency impact of CHF -113 million.

• Operating profit of CHF 68 million (previous year: CHF 204 million). Operating margin of 2.2% (previous year: 5.9%).

• Net income of CHF 17 million (previous year: CHF 147 million). Net margin of 0.6% (previous year: 4.3%).

• Operating cash flow of CHF 180 million (previous year: CHF 90 million). Net liquidity2) of CHF 1 091 million (December 2024: CHF 1 376 million).

• Equity of CHF 11.7 billion (December 2024: CHF 12.2 billion). Equity ratio of 86.2% (December 2024: 87.3%).

• The decline in sales is exclusively attributable to China (including Hong Kong SAR and Macau SAR). Sales in the other regions reached the record years of 2023 and 2024 in local currencies.

• Double-digit sales growth in North America, India, Turkey, Middle East and Australia. Impressive performance of the brands Omega, Longines, Rado, Tissot, Hamilton and Swatch in the USA, with increases of 10% to 30%.

• Operating margin in the Watches & Jewelry segment (without Production) at 10.1%, in the second quarter at 13.5%.

• Strongly negative operating result in the Production segment due to the strategically and deliberately maintaining of production capacities and jobs in Switzerland.

• In China, there are first positive signs of improvement, particularly in e-commerce and the reduction of inventories at retailers. The Group therefore expects an improved market environment in the Greater China region in the second half of the year.

• In summer, Swatch will launch a unique concept for personalizing Swatch watches using AI (Artistic Intelligence).

1. At the end of 2024, the Group transferred the Rivoli Group's eyewear business to a new company in which a minority stake is held. The calculation of the change in sales from the previous year does not include the business transferred.

2. Cash and cash equivalents as well as financial assets, securities and derivative financial instruments, minus current financial debts and derivative financial liabilities.

HALF-YEAR REPORT

-11.2%

- in % of net sales

- in % of net sales

Investments in non-current assets Equity, 30 June

Market capitalization, 30 June

3 445

204

5.9%

147

4.3%

283

12 166

9 617

- Registered shares

- Bearer shares

0.52

2.62

0.01

0.06

Unaudited figures

HALF-YEAR REPORT

In the first half of 2025, the Group's net sales at constant exchange rates were 7.1% below the previous year, on a comparable basis (excluding the eyewear business in the Middle East, transferred at the end of the previous year). The negative currency impact amounted to -3.3%, or CHF -113 million.

Weak consumption in China (including Hong Kong SAR and Macau SAR) and in the Southeast Asian markets, which are heavily dependent on Chinese tourists, continued to have a negative impact on sales and results. Wholesale business in Greater China declined by more than 30%, partly due to the closure of third-party stores, while the Group's own retail business performed slightly better with a 15% decline. This region's share of the Group's total sales has fallen from 33% to 24% in the last 18 months. The Group expects a slight improvement in consumption in China (including Hong Kong SAR and Macau SAR) in the second half of the year.

The USA, Mexico and Canada achieved double-digit growth. In particular, the Omega, Longines, Rado, Tissot and Hamilton brands gained market share, and Swatch also exceeded the very strong figures posted in the previous year. India recorded sales growth of over 20% on the previous year. Japan achieved sales at the level of the record year of 2024. Sales in the Middle East and Australia also developed very well. Switzerland suffered a slight drop in sales due to the very strong Swiss franc, while the other European markets closed at the level of the previous year.

More than 45% of the total sales in the Watches & Jewelry segment was generated by the Group's retail activities. With the exclusion of China, the brands increased retail sales significantly compared to the previous year in local currencies. Sales through e-commerce managed to achieve double-digit growth.

The Group maintained its marketing investments to further boost the appeal of its brands. The Group brands launched promising new products in the first half of 2025, thanks to the Group's industrial and innovative strength. Breguet's special models to mark the brand's 250th anniversary are particularly worth mentioning. Omega had great success with the introduction of Aqua Terra for ladies in June. This collection is equipped with a completely new, ultra-thin mechanical Master Chronometer movement, a technological masterpiece. Tissot launched the PRC 100 Solar with its revolutionary photovoltaic dial. The jewelry segment with Harry Winston continued to develop well.

This summer, Swatch will launch the ultimate in personalization as a world first. Customers will be able to communicate directly with Swatch's artistic intelligence, called AI-DADA, to create their own Swatch watch. AI-DADA will suggest designs inspired exclusively by a database of 40 years of Swatch design history, street painting, events, etc. Each watch will therefore be absolutely unique, according to the customer's wishes, while preserving the Swatch DNA.

HALF-YEAR REPORT

The low level of orders in some cases, both from third parties and from the Group brands, led to a decline in sales and strongly negative operating results in the Production segment. The Group deliberately refrained from laying off its qualified personnel just to mitigate the financial impact. The production companies also did not introduce short-time working.

The Swatch Group's high degree of verticalization leads to losses in Production in the event of a sharp drop in sales. However, once the upswing sets in, the Group benefits more strongly from it. Swatch Group remains committed to its strategic industrial alignment, namely the manufacture of high-volume products in Switzerland, which also benefits the luxury segment. In this domain, the Group is at the forefront of innovation and technology. This is in the interest of the entire Swiss watch industry, including luxury.

Excellent results were reached in the Electronic Systems segment. Renata, Micro Crystal, and EM Microelectronic occupy a worldwide leading position in segments such as healthcare, mobility, battery management system, and miniaturized Bluetooth. In the first half of 2025, segment sales increased by 20.3% (at constant exchange rates).

Inventories fell by CHF 221 million or 2.9% compared to December 2024, primarily in the category of finished watches and jewelry.

The number of employees decreased by 1.9% in the first half of 2025 due to natural fluctuations and amounted to 31 852 persons at the end of June (December 2024: 32 477).

The USA, Japan and India continue to have great growth potential. The Group expects a further reduction of inventories at Chinese retailers and thus a recovery in orders. E-commerce in China continues to show positive signs of increased consumption. As a result, the Group also expects production capacity utilization to improve, driven in particular by numerous new product launches in all price segments.

HALF-YEAR FINANCIAL STATEMENTS

3 059

100.0

3 445

100.0

61

268

-798

-1 316

-177

-25

-1 254

1.8

7.8

-23.2

-38.2

-5.2

-0.7

-36.4

Other operating income

Changes in inventories Material purchases Personnel expense

Depreciation and impairment on property, plant and equipment Amortization and impairment on intangible assets

Other operating expenses

68

43

-549

-1 227

-186

-22

-1 118

Other financial income and expense

Interest expense

Share of result from associates and joint ventures

-8

-1

4

63

204 5.9

22

-1

-1

0.6

-0.0

-0.0

0.3

1

0.0

2.4 225 6.5

224 6.5

Non-operating result

-1.8

-78

-2.2

0.6 147 4.3

Result before income taxes

Income taxes

Net result

Attributable to shareholders of The Swatch Group Ltd

Attributable to non-controlling interests

3

14

136

11

HALF-YEAR FINANCIAL STATEMENTS

Cash and cash equivalents

Financial assets, securities and derivative financial instruments Trade receivables

Other current assets Inventories

Prepayments and accrued income

1 031

245

598

182

7 420

273

9 749

Property, plant and equipment

Intangible assets

Investments in associates and joint ventures Other non-current assets

Deferred tax assets

3 117

150

27

90

425

3 809

1 103

293

612

107

7 641

250

7.9

2.1

4.3

0.8

54.6

1.8

10 006 71.5

3 162

151

34

186

453

22.6

1.1

0.2

1.3

3.3

3 986 28.5

100.0

13 992 100.0

13 558

Unaudited figures

HALF-YEAR FINANCIAL STATEMENTS

Financial debts and derivative financial instruments

Trade payables Other liabilities Provisions Accrued expenses

185

241

164

86

483

1 159

Financial debts

Deferred tax liabilities Retirement benefit obligations Provisions

Accrued expenses

2

492

42

71

111

718

20

270

213

95

424

0.2

1.9

1.5

0.7

3.0

1 022 7.3

2

507

44

71

129

0.0

3.7

0.3

0.5

0.9

753 5.4

13.8

1 775 12.7

1 877

Share capital

Capital reserves Treasury shares Goodwill recognized Translation differences Retained earnings

118

-991

-86

-1 416

-1 074

15 043

118

-978

-132

-1 416

-754

15 274

11 594

85.5

12 112

86.6

Non-controlling interests

87

0.6

105

0.7

11 681

86.2

12 217

87.3

13 558

100.0

Unaudited figures

HALF-YEAR FINANCIAL STATEMENTS

(CHF million) 1st half 2025 1st half 2024

HALF-YEAR FINANCIAL STATEMENTS

(CHF million)

Net result

Currency translation of foreign entities Change in goodwill

Dividends paid

Employee stock option plan Purchase of treasury shares

Transactions with non-controlling interests

136 136 11 147

157 157 6 163

0 0 0

-335 -335 -21 -356

-1 5 4 4

0 -50 -50 -50

Net result

Currency translation of foreign entities Change in goodwill

Dividends paid

Employee stock option plan Purchase of treasury shares

Transactions with non-controlling interests

57 57 15 72

-11 -11 1 -10

-5 -5 -5

0 0 -2 -2

-2 4 2 2

0 0 0 0

-4 23 -59 -40 34 -6

Net result

Currency translation of foreign entities Change in goodwill

Dividends paid

Employee stock option plan Sale of treasury shares

Transactions with non-controlling interests

Balance at 30 June 2025

118

11 681

Unaudited figures

NOTES TO THE HALF-YEAR FINANCIAL STATEMENTS

1. Basis of preparation
   1. Basic accounting principles

      These interim financial statements cover the unaudited half-year results for the six months ended 30 June 2025. They have been prepared in accordance with Swiss GAAP FER (Accounting and Reporting Recommendations). The consolidated half-year closing 2025 was prepared in accordance with FER 31 "Complementary recommendation for listed companies". This half-year report does not include all the information and disclosures which are required in the annual report. It should therefore be viewed in connection with the annual report at 31 December 2024.

   2. Estimates and judgments

In these interim financial statements, Management has reviewed and, if necessary, adapted accounting estimates and judgements. These are based on historical experience as well as other factors such as expectations and assessments of future events, and mainly impact the following areas:

The BEPS 2.0 project launched by the OECD regarding global minimum taxation of companies with an annual turnover of over EUR 750 million came into force in various countries on 1 January 2024, including Switzerland. From 2025, Switzerland has introduced the international top-up tax IIR (Income Inclusion Rule) and can therefore levy additional taxes on profits of Swatch Group companies abroad that are taxed locally at a lower rate than 15%. The Group has accrued the estimated additional top-up taxes of CHF 3 million in current taxes in the half-year financial statements 2025. These mainly relate to countries in the Middle East, Macau SAR and Ireland.

NOTES TO THE HALF-YEAR FINANCIAL STATEMENTS

Net sales 3 300 153 4 -12 3 445 Operating result 263 2 -61 0 204 - in % of net sales 8.0% 1.3% 5.9%

1. Group structure 2025

   Number of companies at 1 January Foundations

   Group internal mergers Liquidations

   Number of companies at 30 June 145

   of which associates 5

   of which joint ventures 2

   148

   0

   -3

   0

   
   
   
2. Key exchange rates

   Average rates Prevailing rates Average rates Prevailing rates Prevailing rates Currency Unit 01.01.-30.06.2025 30.06.2025 01.01.-30.06.2024 31.12.2024 30.06.2024

   CNY	1		0.1186	0.1116	0.1242	0.1240	0.1240
   EUR	1		0.9430	0.9382	0.9669	0.9430	0.9645
   HKD	1		0.1101	0.1018	0.1147	0.1170	0.1154
   JPY	100		0.5823	0.5550	0.5831	0.5790	0.5610
   USD	1		0.8587	0.7995	0.8973	0.9080	0.9010

3. Treasury shares

   In the first half of 2025, Swatch Group sold 192 706 bearer shares with a market value of CHF 29 million. In addition, 1 963 bearer shares with a value of less than CHF 1 million were delivered, related to last year's buyback of minority interests in Belenos Clean Power Holding Ltd (previous year: purchase of 250 000 bearer shares with a market value of CHF 50 million). Registered shares were sold for less than CHF 1 million as part of the employee stock option plan (previous year: CHF 1 million).

   NOTES TO THE HALF-YEAR FINANCIAL STATEMENTS

4. Dividend

   The Company pays one dividend per fiscal year. For fiscal year 2024, the dividend agreed at the Annual General Meeting on 21 May 2025, with a value date of 27 May 2025, was distributed as follows:

   Dividend per share Total dividend

   0.90	105
   4.50	130
   	235
   	-1
   	234

   CHF CHF million
   
   
   

   Registered shares

   Bearer shares

   
   
   Total dividend Dividend not paid out on treasury shares Total dividend paid
5. Significant events and business transactions

   During the period under review, no material events or business transactions occurred that might have an impact on the critical estimates, appraisals and assumptions to be found in the consolidated financial statements as at 31 December 2024. Also, there were no further material events or business transactions that might impact upon other positions in the consolidated financial statements (such as, for example, changes to contingent liabilities and receivables or business transactions involving associated enterprises and persons).

6. Events after the closing date

At the publish date of this press release, the Company is not aware of any significant new event that would affect the half-year financial statements at 30 June 2025.

Original: German

Translations: English, French and Italian

Thierry Kenel, Chief Financial Officer Phone: +41 32 343 68 11

The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: https://www.swatchgroup.com/contactus

Bastien Buss, Corporate Communications Phone: +41 32 343 68 11

The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: https://www.swatchgroup.com/contactus