Transcription
Here's something that should bother you. If someone told you three years ago that the safest place to park money in the watch market was not a Patek Philippe Nautilus, wasn't a Rolex Submariner, but a mid-tier Grand Seiko or a $3,000 Cartier Tank, you'd have laughed them out of the room, right?
And yet, 2025 has ended, the data is in, and the secondary market has rendered its verdict on which brands actually won this year and which prestigious names quietly became liabilities. The biggest losers? Some of the most respected names in Swiss watchmaking. Jaeger-LeCoultre, Blancpain, Breguet, Piaget. All of them owned by the same handful of luxury conglomerates that were supposed to protect them. All of them punished harder than brands a fraction of their size. The answer inverts almost everything collectors have been taught to believe.
Let me give you the number that frames this entire discussion. 2025 has been a materially stronger year for the secondary market compared with the prior three years. After 13 years of decline, the luxury watch market returned to stability in quarter three of 2025. Now, whether that will continue, I'll discuss in a follow-up video. It'll surprise some people. 13 years of bleeding. And 2025 was the year the bleeding stopped.
But here's the thing that makes the story rather intriguing. The recovery wasn't evenly distributed. Not even close. Look at the price tier data. The cheapest watches, under $500, lost 12% over the last year. Entry-level luxury, from $500 to $1,000, dropped nearly 9%. These are the watches people buy thinking they're safe, accessible, low-risk. They were the riskiest tier in the entire market. Meanwhile, the $2,000 to $5,000 segment, up 11%. The $50,000 to $100,000 tier, up 10%. The middle and the near-top one. The bottom got crushed. And the ultra-high end, the $100,000-plus tier, grew a modest 5.5%, underperforming the segments right below.
If you're enjoying this video, you can have all this data at your fingertips whenever you want. There's also the Watch List Tracker, where you monitor your favorite watches, track prices, and spot emerging trends. I will drop a link below.
Now, that's not intuitive. If you ask most collectors where to put money for stability, they have said, "Go cheaper for less risk," or "Go as high as possible for prestige preservation." Both instincts would have lost you money relative to the sweet spots. By Q2 2025, prices had fallen for 12 consecutive quarters, as I said, and value retention across the industry had tanked. Well, excluding Rolex, Patek, and AP, the average watch now trades at minus 31% or worse relative to retail. That number, negative 31%, is the gravity most brands are fighting against. Only a handful managed to escape.
Now let's talk about who owns what, because 2025 exposed a structural problem in how luxury watch groups are built. Look at the conglomerate performance data. Richemont, down 5%. LVMH, down 6%. Swatch Group, down 1%. Maybe they're thankful for that. Every major luxury conglomerate finished in negative territory. Every single one. The only groups that posted gains? You guessed it: Rolex, up 5%, but also Seiko, up 2.7%.
So what do Rolex and Seiko have in common? Focus. Rolex owns exactly two brands: Rolex and Tudor. Seiko Group's watch division is Seiko and Grand Seiko. That's clear. Clear identity. No portfolio delusion. The conglomerates, by contrast, own sprawling portfolios where winners subsidize losers, and the losers drag down the whole ship. The Swatch Group is the clearest example of this. Omega gained 4% this year. That's a big win. But Swatch Group as a whole, down 1%. Why? Because alongside Omega, Tissot down 14%, Longines down 8.2%, and the Swatch brand itself down 16%. Net sales fell 11% to 3.1 billion Swiss Francs, while net profit plunged 88% to 17 million Francs. The company said the decline in sales is exclusively attributable to China.
Jefferies analysts say it's possible Swatch's Chinese business has halved in the last two years alone. The Chinese exposure story is brutal. Sales in Greater China, one of its key markets, declined sharply to 1.83 billion Swiss Francs from 2.63 billion Swiss Francs. That's a billion Franc evaporation from a single region. But here's the thing, this isn't really a China story. It's a portfolio construction story. When you own 16 brands ranging from sub-$100 plastic watches to $40,000 Blancpain, your identity becomes incoherent. The market can't figure out what you stand for. And in a downturn, the weaker brands don't just underperform, they poison the well.
Richemont has the same problem. They own Cartier, up 2.4%. But also Piaget down 14%, IWC down 8.5%, and Jaeger-LeCoultre down 9%. Cartier is carrying an enormous amount of dead weight. Richemont's specialist watchmakers saw sales drop 13% for the 12 months ending March 21st, 2025. The lesson here is counterintuitive but important. Diversification, which protects you in most asset classes, seems to hurt in the secondary watch market. Focus wins. Clarity of identity wins. Portfolio sprawl loses.
So who actually won? Patek Philippe leads the board at 8.2% for the year. The best performer in 2025 is clearly Patek Philippe, led by outstanding gains in the Aquanaut and the Nautilus collections. Now, Patek winning isn't surprising. They've been the apex predator of the secondary market for decades. What's worth understanding here is why they keep winning when other prestigious brands are failing. Patek Philippe produces fewer than 70,000 watches per year. This limited output ensures scarcity, which supports both retail and secondary market prices. 70,000 watches. For context, as we all know, Rolex produces over a million. Patek's entire annual production is a rounding error in Rolex's output. That scarcity, combined with genuine horological credibility, creates a floor under their prices that most brands can't replicate.
Market fundamentals also point to increasing demand, with Patek sports models selling faster this year than they did before. I just did a video on this. The Nautilus and Aquanaut are more than holding value. They're becoming harder to find on the secondary market, which feeds the cycle.
But here's the breakdown. Rolex gained 3.4%. Omega gained 4%. Grand Seiko gained 4.4%. These are very different brands at very different price points. Seiko Group Corporation has revealed that for the 12 months from April 2024 to March of 2025, its global watch sales rose by 12% to 176 billion yen. Seiko stated, quote, "Since it became an independent brand in 2017, Grand Seiko has continued to grow both its domestic and international sales steadily year after year. We're aware that some Swiss brands with sales volumes similar to Grand Seiko have suffered a sales decline over the past two years, but we believe Grand Seiko can still continue to grow." So, Seiko is doing something almost no other brand in its segment is managing: growing while the Swiss competition contracts.
In the first half of fiscal year 2025, Seiko Group reported total revenues of 160 billion yen, with the watch segment contributing 98 billion, up 8.8% from the previous year. Now, I know that's a lot of numbers, but basically, Seiko Group, and especially Grand Seiko, are actually increasing sales in a very down market. Operating profit for the watch unit reached 15.4 billion yen, which translates to a margin of around 15%. For comparison, Swiss groups such as Richemont and Swatch Group reported margins of roughly 3% and 4% to 5% respectively. Now, let that sink in. Grand Seiko's parent company is running 15% operating margins while the Swiss giants are scraping by at 3% to 5%. That's not a marginal difference. That's a structural advantage.
And then there's Cartier, up 2.4% in the secondary market, but the real story is bigger than that. Cartier emerged as the undisputed winner of 2024, marking a significant 24% increase in market share over the previous year. The French maison has been quietly and steadily building momentum since 2020, when it held a modest 3% of the secondary market. Fast forward to 2024, that number has climbed to 5%, representing a quite surprising 66% growth over four years. According to Chrono24 data, Cartier's share of total sales among Gen Z has increased from 1.7% in 2018 to 6.8% today. Cartier is eating market share from every direction.
Cartier's continued success is anchored in two powerhouse models: the Tank and the Santos, which recorded 31% and 28% growth respectively. The top two fastest-growing models in the entire market. The common thread among winners: identity clarity. Patek is scarcity plus complications plus heritage plus models. Rolex is prestige plus reliability plus controlled distribution. Seiko is value plus finishing plus transparency. And Cartier is design plus elegance plus accessibility. None of them are trying to be everything to everyone. They know exactly who they are.
Now for the harder conversation, and I want to separate two distinct failure modes because they require different explanations. Number one, the heritage trap. Jaeger-LeCoultre down 9%. Baume & Mercier down 13%. Breguet down 8%. Piaget, like I said, down 14%. These are not fashion brands that overextended. These are names with genuine horological credibility. Jaeger-LeCoultre made movements for Patek and Audemars Piguet. Breguet invented the tourbillon. We all know the heritage. Blancpain claims the oldest watchmaking legacy in Switzerland, although I think that's gone to Vacheron now. And yet, the market punished them harder than it punished almost anyone else. For collectors who revere these names, it's bittersweet. You can admire the craftsmanship, study the history, recognize the technical mastery, and still watch the market tell you that none of it matters as much as you thought it did. Heritage without relevance is only nostalgia. Nostalgia doesn't hold value.
Notice what's happening. Sports watches within these brands are declining less steeply than dress watches. The Reverso at 5% down versus the Master at negative 10%. The Fifty Fathoms at minus 10% versus the Villeret down 17%. Even in struggling brands, design relevance creates a floor. Part of this is design stagnation. When was the last time the JLC Master actually evolved? When did Blancpain take a real risk with the Villeret? Design heritage is an asset. Design stagnation is a liability. Know the difference. And part of it is parent company neglect. When you're the fifth or sixth priority in a conglomerate portfolio, you don't get the marketing spend, the distribution control, or the strategic focus that independent brands enjoy. These brands aren't failing because they make bad watches. They're failing because nobody is fighting for them.
Then there's a different failure mode entirely. Not neglect, but the opposite problem: overexposure. Swatch, the brand, not the group, down 16%. Oris down 14%. Hublot down 11%. These brands didn't fail because they were ignored. They failed because they were everywhere. Swatch, the brand, has an identity crisis. Is it fashion? Is it accessible luxury? The Moonswatch collaboration with Omega generated enormous buzz, but may have confused more than clarified what Swatch actually is. Oris is suffering from saturation. They've been the darling of the affordable luxury segment for years, which led to aggressive distribution that's now working against them. When you can find a brand anywhere at any authorized dealer, often at a discount, scarcity disappears, and so does resale value. Hublot is paying the price for a decade of aggressive marketing and celebrity partnerships that prioritized visibility over exclusivity. They make good watches, but when you're everywhere, you're nowhere. The secondary market has figured out that an Hublot isn't what it promised it would be.
Inflation has squeezed out aspirational buyers, the ones who used to stretch for a $3,000-$5,000 watch. The brands that depended on that customer are feeling the pain. But overexposed brands are feeling it worst because they trained that customer to expect discounts and availability. When the customer disappears, there's no scarcity mystique to fall back on.
So what do we take from all this? The secondary market is an unsentimental judge. It doesn't care that Breguet invented the tourbillon. It does not care that JLC supplied movements to the Holy Trinity for decades. It doesn't care about your emotional attachment to the brand that your father wore. Current demand is shaped by three factors that have nothing to do with horological merit. Here's how to apply them.
First, ask yourself, is this design still alive? Cartier is winning because the Tank and Santos feel fresh to a new generation of buyers. Gen Z buyers are pushing the market beyond steel sports staples. Their preference for slimmer, design-driven timepieces has led to a four-fold increase for brands like Cartier. Meanwhile, brands with static design languages, no matter how historically significant, are being left behind. If a watch looks identical to what it looked like 20 years ago, maybe that's not heritage, that's inertia.
Second, ask yourself, can I actually get this watch? Rolex and Patek win partly because you can't walk into any store and buy one. That scarcity creates desire. Brands that flood the market with product or allow gray market discounting to erode their positioning pay for it, obviously, on the secondary market. If your target watch is readily available at a discount from gray market dealers, that's a signal. The market is telling you supply exceeds demand, and your resale value will reflect that.
Of course, third, ask yourself, can I describe this brand's identity in one sentence? The market rewards brands that know what they are. Grand Seiko is Japanese finishing and value transparency. Rolex is prestige and reliability. Cartier is elegant design. When a brand tries to be everything, when it sprawls across price points and styles without a coherent identity, the market punishes. If you can't articulate what a brand stands for, neither can anyone else. And that ambiguity will show up in resale value.
So, where does that leave you? Buy what you love. That hasn't changed and won't ever change. But if you're buying with some awareness of value retention, if you care whether your $10,000 purchase will be worth $7,000 or $9,000 in five years, the 2025 data gave you a road map. Focus brands with clear identity outperform portfolio brands with diluted positioning. The $2k to $5k segment and the $50k to $100k segment outperform the extremes. And heritage alone, without design relevance and distribution discipline, is not enough. The market doesn't care about legacy. Sad but true. It cares about relevance. The brands that understand this are thriving. The ones that don't, they're living off borrowed time. See you next.