Swatch Group: First Take – H1 26 Results

Research evidence excerpt

Swatch Group: First Take – H1 26 Results

J P M O R G A N Europe Equity Research

21 July 2026

Swatch Group Underweight

UHR.S, UHR SW

First Take – H1 26 Results Price (20 Jul 26):CHF203.00

Price Target (Dec-27):CHF130.00

Our Take: Swatch reported a mixed set of H1 26 results this morning, with a 2% European Luxury & Sporting Goods

ACbeat on the top line, but a c.60% miss on EBIT consensus estimates. Overall, the Chiara Battistini

Group recorded +8.5% ex-FX sales growth (vs JPMe +5%), an improvement (39-02) 8895-2700

sequentially, driven by strong performance in the US (+27%), Japan (+20%), chiara.x.battistini@jpmorgan.com

Korea (+12%) and selected smaller countries. On the other hand, performance in J.P.(AsiaMorganPacific)SecuritiesLimited plc/ J.P. Morgan Securities

Greater China was mixed, with +9% growth in retail but still “modest” third-party

Wendy Liu

retailer’s replenishment orders (wholesale growth rate not disclosed). Despite (44-20) 3493-9733

solid top-line momentum, the company reported a significant EBIT miss due to wendy.liu@jpmorgan.com

negative FX and operating deleverage in the Production segment. That said, J.P. Morgan Securities plc

management flagged strong exit rates in sales, noting “strong acceleration” in May Apurva Vishwaraj

and June and the first weeks of July, which supported better utilisation of apurva.vishwaraj@jpmchase.com

production capacity, leading to an 8.5% EBIT margin in May and June. As such, J.P. Morgan Securities plc

management expects “a significant improvement in profitability in the second half Victoria Saden

of the year.” While the sales acceleration, exit rate, and confident outlook (44-20) 3493-0435

victoria.saden@jpmorgan.com

statement on profitability may support the shares first thing today, the significant J.P.