Analysis
Richemont is experiencing a significant financial headwind from U.S. tariffs introduced in April 2025, specifically those associated with the reciprocal or Liberation Day tariff announcements. The company has identified these tariffs as a primary external macroeconomic pressure affecting its gross margin. Management estimates that the total adverse impact from these duties will reach approximately €300M for the full 2026 fiscal year, assuming current tariff rates remain in place. This estimate accounts for the company's anticipated shipment volumes and the depletion of existing lower-cost inventory.
The impact observed during the first half of the 2026 fiscal year was relatively contained at €50M. This limited initial effect was attributed to two main factors: proactive inventory management and the phased implementation of the tariff rates. Initially, products manufactured in the European Union faced duties of 10% to 15%, while a much steeper 39% tariff was applied to Swiss-made products beginning in August 2025. Because Richemont maintains roughly 18 months of inventory coverage, many of the items sold in the first half were imported before the highest rates took effect. As this inventory is sold and replaced by goods subject to the 39% duty, the company expects a disproportionately larger cost impact in the second half of the year.
To mitigate these cost increases, Richemont has implemented targeted and balanced price adjustments, notably in May and September 2025. These increases were designed to reflect the higher-cost environment—which also includes rising gold prices—while maintaining the long-term desirability and value of its jewelry and watch collections. Management reports that these pricing actions have not resulted in significant demand destruction or a noticeable decline in store traffic. Sales in the Americas continued to show momentum with 18% growth in the first half of the fiscal year, suggesting that the brand equity of its primary Maisons, such as Cartier and Van Cleef & Arpels, has provided a degree of resilience against tariff-induced price hikes.
The company remains cautious about the future trade environment and the potential for retaliatory measures or further tariff fluctuations. While there has been some communication regarding potential resolutions to trade tensions between Switzerland and the United States, Richemont's current financial guidance and operational planning continue to assume the higher tariff regime persists. The ongoing strategy focuses on maintaining cost discipline and utilizing its robust net cash position of €6.5B to navigate these external pressures while continuing to invest in its manufacturing and retail networks.
Data
Estimated U.S. Tariff Impact (FY2026)
| Period | Net Tariff Cost Impact (€M) |
|---|---|
| 1H-2026 Actual | €50 |
| FY-2026 Estimate | €300 |
Source: Transcript 1H-2026, Interim Report 1H-2025, Marvin Labs
Financial Impact
- Cost Impact (Historic): €50M
- Cost Impact (Forward-Looking): €300M
Sources
Based on the current levels of our US inventories and planned shipments, we estimate the full adverse impact of the increased US tariff rates to be around EUR 300mn for the full current fiscal year.
In the first half, the impact of increased US tariff rates was limited to some EUR 50 million, thanks to our proactive inventory management since April and due to the phasing of the implementation of different tariff rates... starting with 10%, then 15% for Europe-made products, followed by 39% in August for Swiss-made products.
We have not seen a true impact, let's say, in desirability or traffic in the stores, meaning by that that we did not necessarily notice a specific spike of purchasing before the price increase nor decrease afterwards.