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Highlights
- Cettire sees weaker US demand amid trade tensions
- Tariffs on China-made goods spark further sales volatility
- Revenue rises marginally despite currency-related losses
Luxury online retailer Cettire (ASX:CTT) is navigating a challenging period, particularly in its largest market, the United States, as ongoing US trade policies create ripples across its operations. The company recently flagged softer demand from American consumers, attributing the shift to the effects of tariffs introduced under the Trump administration.
The volatility in Cettire’s US sales trajectory has been more pronounced since April, when the US ramped up its tariffs on global trade partners. Interestingly, even products not directly affected by these duties have experienced slower sales momentum, pointing toward a broader impact on consumer sentiment and purchasing patterns in the luxury e-commerce segment.
Cettire indicated that while the general tariff environment has disrupted overall demand, there is also the possibility of more targeted effects from new tariffs on China-manufactured items being sold into the US market. Although these are expected to have a lesser direct impact, the retailer remains cautious in its outlook.
To counterbalance this regional instability, Cettire is intensifying its efforts toward geographic diversification. This strategic move aims to reduce dependency on any single market and shield revenue from region-specific headwinds. Such a shift may pave the way for more stable growth in the longer term, particularly as global trade dynamics continue to evolve.
Financially, the company reported a 1% rise in revenue for the recent period, totaling $192.5 million. However, adjusted earnings saw a decline of $4.7 million compared to the prior year. A $2.1 million realised foreign exchange loss further contributed to the earnings dip, reflecting the challenges of operating across multiple currencies in a volatile macroeconomic environment.
Despite these headwinds, Cettire expressed confidence in its relative positioning within the broader luxury retail market. The company noted that, although revenue growth moderated compared to the first half of FY25, its performance is still expected to outpace the wider luxury sector. Recent industry results and outlooks indicate declining trends across several major luxury brands during the March quarter.
Looking ahead, Cettire’s ability to adapt through diversification and navigate foreign exchange pressures will be critical. While near-term challenges persist, its agile operating model and commitment to international expansion offer a potential buffer against market-specific disruptions.
