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Are omega (swatch group) struggling?

peatnick
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ErichPryde ErichPryde
Looks like investors did exactly this several days ago judging from the chart; vs prior day avol, ran 23X volume, and was a big enough move that it DOUBLED the 28 day average volume. Next day ran 10X the new average volume- down. I don't think I've ever looked at Swatch group, very thinly traded and I'd guess it's trading on a European exchange in addition to an American one (looks OTC here).

I'm trying to figure out why Niedzielski had ~120,000USD position, even being as small as 0.11% of his 109M AUM. Definitely a case where I want to own the watch, not the chart.

Maybe the last 2 sentences are telling…

“Could there be logic in this madness?,” Bernstein analyst Luca Solca wrote in his report. “The attitude of the Swatch Group’s CEO would make perfect sense if his goal was to take Swatch Group private at some point.”

De-listing the company “would be a very attractive option for us, however, the Hayek family’s philosophy is not to go into debt,”

Time will tell if that’s Hyack’s strategy 😗
 
SpeedyPhill
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Inflation etc... so most people prioritize and luxury watches certainly aren't on most people's radar. This explains a significant drop in sales ... hence profits, shares.... 🤔
 
EuroDriver
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dstfno dstfno
Sure, quality wise you can't separate them or maybe even give Omega the advantage. But Rolex's brand equity puts them in a higher tier imo.

On that logic, I guess Payless shoes are now in a higher tier than Florsheim lol!
Payless Sold Discount Shoes at Luxury Prices

As an old colleague used to say: you can market the worst piece of crap and if you make it expensive enough, people will buy it..
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SpeedyPhill
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July 15, 2024 ... Fortune.com
Swatch group profits drop 70%. The big impact is really mainly China.
🍿
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Edit: screenshot added
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FORTUNE_Swatch.jpg
Edited:
 
texasmade
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SpeedyPhill SpeedyPhill
July 15, 2024 ... Fortune.com
Swatch group profits drop 70%. The big impact is really mainly China.
🍿
.
Edit: screenshot added
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FORTUNE_Swatch.jpg
If Swatch really needed more money, they could easily make a bunch of $ by producing more Snoopy 50's and EW 321's.Those will sell instantly.
 
Annapolis
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texasmade texasmade
If Swatch really needed more money, they could easily make a bunch of $ by producing more Snoopy 50's and EW 321's.Those will sell instantly.

or they could adjust their prices to better reflect market reality. A Seamaster 300 pro that’s worth $3500 US the second it leaves the store shouldn’t retail for $6k anymore. If they sold them for $4k, I’m guessing they’d sell way more… Omega’s my favorite brand but I only buy preowned, even when I’m getting an unworn watch, as the AD/OB “experience” makes me feel like I’m getting ripped off. That’s a bad look for the brand.
 
texasmade
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or they could adjust their prices to better reflect market reality. A Seamaster 300 pro that’s worth $3500 US the second it leaves the store shouldn’t retail for $6k anymore. If they sold them for $4k, I’m guessing they’d sell way more… Omega’s my favorite brand but I only buy preowned, even when I’m getting an unworn watch, as the AD/OB “experience” makes me feel like I’m getting ripped off. That’s a bad look for the brand.
Not going to happen. The moment they lower to $4k, then the GM will adjust to $3k. It becomes a race to the bottom and the brand loses some of it's luxury appeal.
 
Annapolis
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Oh for sure--I'm not suggesting they'd actually ever do this. Only that it's one reason for my own seeming hypocrisy: Omega is probably my favorite brand (full stop)--certainly my favorite brand of watch--yet I've only ever purchased one of their watches at retail from Omega itself, and I have little interest in ever doing so again. If they want this devotee as an actual customer, then they'll have to come down to earth a bit. But I'm just one small-time customer: I expect they know what they're doing, even if their sales numbers suggest otherwise.
 
gatorcpa
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I expect they know what they're doing, even if their sales numbers suggest otherwise.
Actually, I don't think they do. In fact, I don't think any of the watch companies know what they are doing except one (that starts with an "R"). They are more reactionary than pro-active in the marketplace.

Bottom line is that a public company is generally managed to the expectations of the major shareholders, frequently on a year-to-year or even a quarter-by-quarter basis. If management doesn't meet earnings expectations, out they go and they bring in someone new. So people have to be focused on the here and now. They are not able to properly focus on the future of the business, as it very well may not include them. This puts them at great risk to changes in the market like government regulations in China and other factors. Makes it really hard to do marketing as well.

Rolex is such a different story as a company. They are privately controlled by the same families for over 100 years. Due to their non-profit structure, they also have a built-in tax advantage over public company competitors like Omega to a certain extent. No one else could have pulled off the deliberate decrease in production and profits during the pandemic in order to protect the brand equity. It's going to pay off for them greatly in the future.

The companies in the luxury goods space that are highly successful in marketing their brands to the point that second-hand versions of their products are almost as valuable as new tend to be smaller and privately controlled, such that almost every aspect of the business in under one roof. Rolex didn't start out that way, but over the years acquired most of their suppliers. Along with Seiko, they are vertically integrated, while almost all of the others are dependent on outside companies for much of the non-watch movement parts. Expensive and inefficient in many ways.

But have said all of that, markets have a way of evening out over time. Let's see how Omega/Swatch performs in the next turnaround. I really don't think all these "crossovers" between Swatch, Omega and Blancpain help, but what do I know.
gatorcpa
 
sheepdoll
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texasmade texasmade
Not going to happen. The moment they lower to $4k, then the GM will adjust to $3k. It becomes a race to the bottom and the brand loses some of it's luxury appeal.

b.bb.bbbut they are entry level watches.

Somehow I do not see any of this affecting the spare parts market. And the brand does not really benefit from used vintage sales. While they could make a few franks from selling parts to collectors. The other entry level watch has been successful restricting product and parts for many decades.
 
STANDY
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Omega’s my favorite brand but I only buy preowned, even when I’m getting an unworn watch, as the AD/OB “experience” makes me feel like I’m getting ripped off. That’s a bad look for the brand.

IMG_8769.gif
 
C
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Omega has lost their way and I say this as a huge Omega fan, I have more Omega watches than Rolex etc. Omega's watches are too thick, too heavy too flashy and with way too many special editions and fake patina dials.
Early 2000's Omega watches were their pinnacle in my opinion, 1st gen PO, 1st gen Aquaterra, proper Seamaster Bond watches.
Omega has an amazing catalog of historical watches. They should stick to a small core of watches, Speedmaster, PO, Bond, Aquaterra but with less variations. Make them thinner and lighter. Do a proper modernized reissue of the original Seamaster 300 like they did with the 321. Charge higher prices for that core group of watches.
 
pdxleaf
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C curated
Omega has lost their way and I say this as a huge Omega fan, I have more Omega watches than Rolex etc. Omega's watches are too thick, too heavy too flashy and with way too many special editions and fake patina dials.
Early 2000's Omega watches were their pinnacle in my opinion, 1st gen PO, 1st gen Aquaterra, proper Seamaster Bond watches.
Omega has an amazing catalog of historical watches. They should stick to a small core of watches, Speedmaster, PO, Bond, Aquaterra but with less variations. Make them thinner and lighter. Do a proper modernized reissue of the original Seamaster 300 like they did with the 321. Charge higher prices for that core group of watches.

Maybe, but then we wouldn't have this:
1000016611.jpg
 
Speed2Sea
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C curated
Charge higher prices for that core group of watches.
Why would increasing prices be beneficial to the brand?
 
gbesq
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C curated
Omega has lost their way and I say this as a huge Omega fan, I have more Omega watches than Rolex etc. Omega's watches are too thick, too heavy too flashy and with way too many special editions and fake patina dials.
Early 2000's Omega watches were their pinnacle in my opinion, 1st gen PO, 1st gen Aquaterra, proper Seamaster Bond watches.
Omega has an amazing catalog of historical watches. They should stick to a small core of watches, Speedmaster, PO, Bond, Aquaterra but with less variations. Make them thinner and lighter. Do a proper modernized reissue of the original Seamaster 300 like they did with the 321. Charge higher prices for that core group of watches.

I'm more a collector of vintage Omega, but I have to respectfully disagree that Omega has lost its way with its current designs. Of the three "modern" watches that I own, this is one of my favorites. It's a beautiful watch, certainly not that thick or heavy (strapped on a Tudor hockey puck lately?), not at all flashy and I think that the fauxtina is rather nicely done. I like the innovation of the sandwich dial, the traditional aluminum bezel that has been hardened (more innovation), the bracelet is excellent and the accuracy is astonishingly good. What's not to like?
1686070-d0241a79a35cb5f966487e4ac61cb78a.jpg
Edited:
 
dsio
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I definitely agree that Omega needs to address the thickness issue in the next generation of several models. Pieces line the Planet Ocean GMT are just too tall for a fairly simple dive watch and the whole range is quite rotund. If they can get back to their mid 2000s thicknesses without losing anything they’ll be doing very well.
 
Jakeys
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gbesq gbesq
I'm more a collector of vintage Omega, but I have to respectfully disagree that Omega has lost its way with its current designs. Of the three "modern" watches that I own, this is one of my favorites. It's a beautiful watch, certainly not that thick or heavy (strapped on a Tudor hockey puck lately?), not at all flashy and I think that the fauxtina is rather nicely done. I like the innovation of the sandwich dial, the traditional aluminum bezel that has been hardened (more innovation), the bracelet is excellent and the accuracy is astonishingly good. What's not to like?

I wouldn't say they've lost their way exactly, many aspects of Omega's current designs are excellent. But, as others have already said, the size is an issue. Your heritage Seamaster, beautiful as it is, is 13.9 mm thick, while the standard Diver is 13.6 mm thick. The current Rolex Submariner 124060 is 12-12.5 mm thick (Rolex don't say and sources vary) and the original Seamaster Pro's from the 90's and 00's were 11.5 mm thick.

The Aqua Terra, too, is currently 13.4 mm thick. This is meant to be a dressier everyday watch, yet it's closer to the original Planet Ocean than a current model Submariner, let alone the 11.5 mm Explorer! Don't even get me started on the POs, though they should be a bit thicker than the Diver by their nature.

I'm also not a fan of the faux patina, I'm at best indifferent - though I respect a lot of people love it. The issue I have is, while it can look cool on heritage models, I think they overuse it. As an example,you couldn't buy the standard modern Railmaster in black or silver without faux patina. Heritage yes, special editions like NTTD sure okay, but the entire Railmaster line? That was a misstep.
Edited:
 
gbesq
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Jakeys Jakeys
I wouldn't say they've lost their way exactly, many aspects of Omega's current designs are excellent. But, as others have already said, the size is an issue. Your heritage Seamaster, beautiful as it is, is 13.9 mm thick, while the standard Diver is 13.6 mm thick. The current Rolex Submariner 124060 is 12-12.5 mm thick (Rolex don't say and sources vary) and the original Seamaster Pro's from the 90's and 00's were 11.5 mm thick.

The Aqua Terra, too, is currently 13.4 mm thick. This is meant to be a dressier everyday watch, yet it's closer to the original Planet Ocean than a current model Submariner, let alone the 11.5 mm Explorer! Don't even get me started on the POs, though they should be a bit thicker than the Diver by their nature.

I'm also not a fan of the faux patina, I'm at best indifferent - though I respect a lot of people love it. The issue I have is, while it can look cool on heritage models, I think they overuse it. As an example,you couldn't buy the standard modern Railmaster in black or silver without faux patina. Heritage yes, special editions like NTTD sure okay, but the entire Railmaster line? That was a misstep.
All fair points. Regarding thickness, however, I would note that my 300 Heritage is actually very slightly thinner than my 1969 Speedmaster Professional as well as the previous generation 300 model, so certainly not thin, but it hasn't ballooned in size either.
Edited:
 
sathomasga
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dsio dsio
I definitely agree that Omega needs to address the thickness issue in the next generation of several models. Pieces line the Planet Ocean GMT are just too tall for a fairly simple dive watch and the whole range is quite rotund. If they can get back to their mid 2000s thicknesses without losing anything they’ll be doing very well.

I think it's more than thickness. Admittedly, I'm very partial to vintage watches and I have a tiny (15cm) wrist, but if I look at the current Rolex catalog, there are at least two models that I would love to own: the 34mm OP and the 36mm Explorer. I don't see anything comparable in Omega's offerings. There are some 34mm and 36mm Constellations but the modern Constellation design is, IMHO, uggggly. Closest is the new 34mm Aqua Terra, but I much prefer the design of the larger version.

It's a bit sad because Omega is by far my favorite brand. (I own 7 vintage Omegas, but no more than 2 of any other brand.) Yet if someone gave me $10K that I had to spend on a modern Omega watch, I honestly would not be able to buy one that I'd actually wear.
 
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