Editor’s Note: This story originally appeared in On Balance, the ARTnews newsletter about the art market and beyond. Sign up here to receive it every Wednesday.
If you’ve been following ARTnews‘ reporting on the luxury market over the last year, you’ll know that luxury sales at the major auction houses are booming. At Christie’s, such sales jumped 30 percent year on year in the first half of 2025, to $468 million, before climbing a further 15 percent, to $539 million, in the first half of this year. Over at Sotheby’s, luxury is even bigger: sales hit a record $2.7 billion in 2025, up 22 percent year on year and accounting for roughly 39 percent of the house’s $7 billion in total sales. That compares with $2.2 billion in luxury sales in 2024 and more than $2 billion in each of the previous two years.
And this growth is showing no sign of slowing. Sotheby’s reported a record first half for its luxury division in 2026, with global watch sales up 64 percent year on year and jewelry sales up 13 percent. As for Phillips, earlier this year its watch department recorded the most successful spring season in its history, with record-breaking sales across Geneva, New York, and Hong Kong topping $235 million.
However, what makes these numbers appear even more impressive—and perhaps surprising at first glance—is that the broader luxury market has been hemorrhaging buyers. According to consulting firm Bain & Company, 50 million customers exited the market between 2022 and 2024, falling from around 400 million to 350 million. That’s one-eighth of the industry’s buyer base. Bain said this exodus has mostly been driven by soaring prices and a weakening value proposition. In May, the Financial Times‘ Business of Luxury Summit in Puglia similarly painted a picture of a struggling industry, with the CEO of Saint Laurent telling attendees that the industry has to do better at “retaining clients.” Other executives blamed weak consumer sentiment, fragile Chinese demand, and years of aggressive price increases for pushing many shoppers away.
So why hasn’t this contraction hit the auction houses?
The short answer, according to Max Fawcett, Christie’s global head of jewelry, is that the two markets are not as closely connected as the headline numbers might suggest. Bain’s figures encompass an incredibly broad spectrum of luxury consumption, from $2,000 sneakers and sweaters to high jewelry and watches, while the auction houses tend to operate at the much narrower top end of the market, where wealthy buyers are chasing rare and exceptional objects.
“When we have so many people trying to buy the best things because there are very few of them, it just hasn’t linked through yet from that broader contraction into the auction world,” Fawcett told ARTnews.
Fawcett pointed to what he describes as a “K-shaped recovery,” in which the wealth of the richest consumers has continued to rise even as more discretionary buyers have retreated. That bifurcation is particularly pronounced in jewelry and watches, he said, where the major maisons have continued to report growth. For example, LVMH reported that its watches and jewelry division, which includes Tiffany & Co. and Bulgari, grew 9 percent organically in the first half of 2026 and 11 percent in the second quarter. (Overall revenue at the luxury giant did, however, drop 3 percent on a reported basis in that period.)
But, of course, this doesn’t mean the two markets are completely separate. Fawcett said Christie’s is seeing some customers who were traditionally primary-market luxury buyers move into auctions after discovering the rarity and value available on the secondary market. Others, namely the ultra-wealthy, are continuing to buy directly from brands despite the premium, drawn by the service, “experiential luxury,” and access that the primary market can offer.
In other words, the auction houses may not be absorbing the customers who have been lost by the luxury industry. Instead, it looks like they’re benefiting from the same polarization of spending reshaping the primary market. That is, fewer aspirational consumers, but continued—and potentially intensifying—spending by the wealthiest buyers.
The movement from primary to secondary is not necessarily a sign of distress. As Fawcett explained, some clients who once bought predominantly from luxury brands are now turning to Christie’s after discovering that the secondary market can offer rarity, provenance, and, often, a significant price advantage. This can make it more appealing than the primary market.
The distinction made by Fawcett is particularly important in jewelry, where the most desirable stones and pieces can be decades or even centuries old. He pointed to antique jewelry, old-mine emeralds, and Kashmir sapphires (all of which can no longer be produced or mined) as examples of objects for which the secondary market is effectively the primary source.
Price is another draw. Fawcett said a stone bought at auction can sometimes be repolished, reset, and ultimately sold through a luxury maison at a substantial markup. For buyers who are more interested in rarity and the object itself than the experience of buying directly from a brand, auctions can therefore be a more compelling proposition.
But the migration is far from universal, and Fawcett said some of Christie’s wealthiest clients continue to buy directly from the major maisons, even when they know they’re paying a premium. Often, when they do this, they are not simply buying an object, but access to the hyper-exclusive ecosystem around it. This includes private events, world-class service, rubbing shoulders with famous designers and fashion’s top brass, and the status that comes with being one of a brand’s VVIPs.
“It doesn’t matter how much money you have; the auction houses can’t do that most of the time,” Fawcett said of the access offered by the major maisons like Chanel, Cartier, Hermès, and Louis Vuitton.
Sotheby’s, for its part, has been shoring up its luxury experiential offerings. For example, the house has organized ad hoc wine tastings and vineyard tours in France for its VVIP clients. It even embedded some high-end road bike collectors with a Tour de France team in July. The house also recently partnered with high-end, membership-based luxury travel agent Indagare to offer exclusive holidays built around insider cultural access and fine dining. Upcoming trips, which cost around $20,000 per person, include a four-day trip to Venice in September, where guests will stay in the five-star Gritti Palace, tour the Biennale with Sotheby’s managing director for Italy, and visit museums after hours.
Going back to Fawcett’s comments, it’s therefore not unusual for the same wealthy customer to oscillate between primary and secondary luxury depending on what they’re after—whether it be a new piece and the experience surrounding it from a brand, or an exceptional vintage object that can only be found at auction.
There is also a geographical shift underway, with Christie’s seeing fewer buyers based in Europe, even as many of its sellers remain European. Increasingly, demand is coming from the Middle East, Asia, and the US. This development could become even more significant as European collections accumulated over generations come to market, Fawcett told me.
Luxury is also becoming an important gateway into the auction house ecosystem itself. At Christie’s, 38 percent of new buyers in 2025 made their first purchase through a luxury category rather than art, according to figures previously provided to ARTnews. Many of those purchases were made online, suggesting that luxury can serve as a relatively accessible entry point for clients who might otherwise never have participated in an auction.
Guillaume Cerutti, Christie’s former CEO, previously told ARTnews that luxury sales, alongside contemporary art, had become one of the house’s primary sources of new clients, with the aim of encouraging those buyers to explore other categories, particularly fine art.
Phillips’ results suggest the shift is not confined to Christie’s and Sotheby’s; for its spring season, 40 percent of its buyers were new to the house, with millennials and Gen Zers accounting for nearly a third of bidders and buyers. This shows that the auction houses are not simply harvesting spending from the existing luxury elite—they are also finding ways to bring a new generation of consumers into the secondary market.
Sotheby’s 90 percent sell-through rates for its watches and jewelry sales have helped fuel its record first-half 2026 results for its luxury operation. Josh Pullan, the house’s global head of luxury, said of the results that collectors were responding to “quality, rarity, and provenance.”
As it stands, then, there’s little evidence that the luxury downturn has filtered meaningfully into the auction houses. If anything, the opposite is happening. The houses are capturing spending from wealthy collectors, winning over some former primary-market customers, and using luxury to entice entirely new buyers over to the auction ecosystem.
But that also leaves an important question unanswered. The auction market may be insulated from the loss of aspirational luxury consumers because it is selling to a much narrower and wealthier clientele. If the luxury slowdown eventually reaches that group, however, the relationship between the primary and secondary markets could look very different.
For now, at least, the evidence suggests the auction houses aren’t riding out luxury’s downturn so much as occupying a different, and currently much healthier, part of the market. The question, then, is not whether the luxury downturn will eventually reach the auction houses, but whether they can turn their current divergence from the primary market into a lasting advantage.
