Yen weakness subdues Japan luxury splurge at Cartier-owner Richemont

• A strengthening of the Japanese yen weighed on Cartier-owner Richemont's fiscal first-quarter sales.
• A weak yen had boosted international tourism and luxury spend in the East Asian country last year.
• The Japanese yen began steadily depreciating in 2024 after the Bank of Japan brought an end to negative interest rates.

A currency-fueled spending splurge in the key Japanese luxury market has finally abated, weighing on sales at Cartier-owner Richemont.

The Swiss luxury group's Japan sales declined 15% year-on-year at constant exchange rates in the fiscal first quarter, it said Wednesday in its fiscal first-quarter sales report.

Revenues at the Swiss luxury group nevertheless rose 6% year-on-year at constant exchange rates to 5.41 billion euros ($6.28 billion) in the three months to the end of June, slightly ahead of the 5.37 billion euros forecast by analysts in an LSEG poll.

Shares were up 1.08% by 11:40 a.m. London time.

The decline in Japan sales follows a 59% jump in revenues in the same quarter last year, as a weaker yen sparked a surge in international tourism and luxury spend.

The Japanese yen began steadily depreciating last year after the Bank of Japan brought an end to negative interest rates and terminated its yield curve control policy in March. In June of that year, the Japanese currency weakened to 38-year lows, crossing the 161 mark against the dollar.

Richemont, whose brands also include Van Cleef & Arpels and Buccellati, benefitted from that weakness throughout last year, reporting 20% to 25% sales growth in Japan over consecutive quarters.

It was not alone. Other major luxury groups LVMH, Kering and Burberry all noted the uptick, led in particular by Chinese shoppers flocking to the East Asian country.

However, a recent strengthening of the yen in the first half of 2025 has put paid to those trends.

“In Japan, sales declined by 15% against a demanding +59% comparative in the prior-year period, with a strengthening Yen strongly reducing tourist spend, most notably from Chinese clientele, whilst local demand remained positive,” Richemont said in a statement accompanying the Wednesday results.

Richemont has nevertheless emerged a rare outlier in a wider luxury downturn, as demand among wealthy shoppers for its high-end jewelry continues to shine.

Sales at the group's Jewellery Maisons division once again led the charge in the latest report, rising 11% at constant exchange rates.

Revenues within its Specialist Watchmakers division, which features Piaget and Roger Dubuis, meanwhile continued to lag, declining 7% over the period.