Chow Tai Fook reported a modest dip below profit expectations, reflecting the tougher conditions shaping China’s jewellery landscape. The group posted first-half net income of HK$2.5 billion, slightly shy of forecasts, with gross margin easing to 30.5%. The company noted that stronger demand for higher-margin fixed-price pieces and the lift from gold prices helped cushion performance.
In mainland China, average selling prices for fixed-price gold jewellery continued to rise, supported by a premiumisation strategy aimed at standing out in an increasingly crowded market. Even so, the retailer continues to navigate a mix of challenges — from erratic gold prices and subdued consumer spending to stronger competition from emerging domestic brands.
The road ahead has become less predictable following the removal of China’s long-standing tax rebate on gold from 1 November, a policy shift that may increase costs for shoppers and tighten retailer margins. Chow Tai Fook has already made selective price adjustments to reflect earlier gold price movements.
Despite the near-term uncertainties, the company maintains confidence in sustaining its recovery through the second half of fiscal 2026. Its shares have surged 127% so far this year, underscoring investors’ faith in its long-term trajectory.