Shares of Watches of Switzerland Group Plc slumped nearly 30 percent after the top seller of Rolex watches in the UK cut its sales and growth forecasts, blaming volatile demand and a shift in luxury spending habits.

The company, also a major luxury watch and jewellery dealer in the US, said holiday sales were volatile amid challenging macroeconomic conditions that it expects to persist.

The company cut its full-year revenue target to between £1.53 billion ($1.94 billion) and £1.55 billion from a previous forecast of £1.65 billion to £1.7 billion. Organic revenue growth targets were slashed to between 2 percent and 3 percent from 8 percent to 11 percent previously.

Shares fell as much as 28 percent in early trading in London.

Chief executive officer Brian Duffy said “the festive period was particularly volatile this year for the luxury sector, with consumers allocating spend to other categories such as fashion, beauty, hospitality and travel.”

Demand for luxury watches has slowed after an unprecedented boom during the pandemic.

Continued weak sales after Christmas has likely prompted the downgraded forecasts, said analysts at Jefferies.

By Andy Hoffman

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