Swatch Group's Open Letter to Morgan Stanley: Unveiling the Truth Behind the Numbers
In a bold move, the Swatch Group has taken aim at the widely read Morgan Stanley 'Swiss Watcher' industry report, questioning its accuracy and assumptions. The Swatch Group's open letter, addressed to Morgan Stanley's management, highlights discrepancies in data and estimates, particularly regarding Longines and Tissot's performance.
The Core Issue: Data Discrepancies and Assumptions
The letter criticizes the report's rankings and estimates of sales and production figures for the top 50 Swiss watch brands, calling them 'erroneous and questionable'. This is a significant claim, as it challenges the very foundation of the report's conclusions. For instance, the report's assertion that Longines lost money in 2025 is refuted by Swatch Group, which states that Longines actually reported a profit of 16.6% on net sales.
The Tissot Counterpoint
Swatch Group also takes issue with the Morgan Stanley report's estimates for Tissot. While the report predicts a 5% contraction in sales, Swatch Group reveals that Tissot's PRX model maker achieved a 3% sales growth in 2025. This discrepancy highlights the potential for biased or inaccurate data in the report.
The Hamilton Mystery
The letter also uncovers discrepancies in the Morgan Stanley report's figures for Hamilton. Swatch Group claims that Hamilton's unit sales are three times higher than stated, and the average retail price is significantly lower than estimated. This raises questions about the reliability of the report's data and the methods used to compile it.
The Industry's Opacity
It's important to note that the Swiss watch industry is notoriously opaque, with many of the biggest brands being closely held or family-owned. This opacity makes it challenging for analysts and investors to accurately estimate production, sales, and profit figures for individual brands. Morgan Stanley's report, like others in the industry, relies on estimates and assumptions, which can lead to discrepancies and disagreements.
The Invitation to Discuss
Swatch Group's open letter invites further discussion and scrutiny of the Morgan Stanley report. By publicly challenging the report's data and methods, Swatch Group encourages a critical evaluation of the industry's reporting practices. This controversy highlights the importance of transparency and accuracy in financial reporting, especially in an industry as competitive and influential as Swiss watchmaking.
