Swatch slams Morgan Stanley over report on losing market share
The Swiss watchmaker describes the report’s conclusions and the rankings of watch brands as ‘questionable’
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[ZURICH] Swatch Group took aim at Morgan Stanley after the US investment firm said in a research report the Swiss watchmaker was losing market share and that its Longines brand became unprofitable last year.
“The figures and statements in the research are based on unsuitable and not transparent data sources,” Swatch said in an open letter to Morgan Stanley Investment Management published on its website on Friday (Feb 27). “As far as our brands are concerned, the figures in the research are highly inaccurate.”
The Feb 18 report, compiled with industry adviser LuxeConsult, said Swatch Group’s market share has shrunk 10 percentage points since 2019 and had the industry’s biggest drop in 2025. It described Longines as Swatch’s “main problem child,” citing high management turnover and reliance on China.
Among its numerous criticisms of the report, Swatch – which does not give a detailed breakdown of its brands’ performances – countered that Longines reported “a profit of 16.6 per cent on net sales” in 2025.
Oliver Mueller, head of Switzerland’s LuxeConsult, and Morgan Stanley had no immediate comment.
Swatch’s operating profit margin tumbled by more than half to 2.1 per cent in 2025, it reported last month, as the company grappled with weak demand in China and the fallout from President Donald Trump’s tariffs in the US. The watchmaker’s policy of maintaining jobs, production and inventory to be ready for an upturn has also faced criticism from investors for keeping costs high.
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Shares of Swatch have rebounded more than 20 per cent since the company gave a more optimistic outlook for the current fiscal year, though they are still well below their level in the post-pandemic boom that lifted luxury brands.
They fell as much as 3.1 per cent on Friday.
In the report, Morgan Stanley also said revenue for Swatch’s Omega brand had stagnated at around 2.2 billion Swiss francs (S$3.6 billion) for more than a decade, and was overtaken by Patek Philippe and Audemars Piguet last year.
Swatch described the report’s conclusions and the rankings of watch brands as “questionable.” It also said that unlike Morgan Stanley, LuxeConsult did not disclose potential conflicts of interest.
“Occasionally, the research even produces defamatory and potentially damaging statements,” Swatch said, adding “legal action should be considered.” BLOOMBERG
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