Cartier owner Richemont expects trading to remain volatile after net profit slid more than the market expected and watch sales fell 15% in its latest financial year.
Luxury watchmakers have been grappling with dwindling demand in their biggest markets, Hong Kong and the US.
Sales had improved of late thanks to easier comparisons and what appears to be a sustainable recovery in mainland China.
However, Richemont struck a cautious note today.
"Volatility and uncertainty in the geopolitical and trading environments are likely to prevail," the world's second-biggest luxury goods group said in a statement.
Chairman and controlling shareholder Johann Rupert said he was confident of the longer-term potential for luxury goods because the Chinese - crucial consumers - would keep traveling and help revive European markets that suffered in the aftermath of militant attacks.
But outgoing chief financial officer Gary Saage said it was too early to say the worst was over in the important Hong Kong market that has collapsed over the last two to three years.
LVMH, the world's biggest luxury goods group, last month reported underlying sales growth of 11% in its watch and jewellery business in the first quarter of 2017, helped by a recovery in Europe and Asia.
Sales at Richemont fell 4% to €10.65 billion in the year to the end of March, missing expectations, but with a clear improvement in the second half thanks to a recovery in the USs and strong growth in mainland China.
Despite a 46% drop in net profit after a one-off gain a year ago, the company announced a new share buyback and a 6% higher dividend, but shareholders were unimpressed.
Jewellery sales, which represent 39% of group sales mainly under Cartier and Van Cleef & Arpels brands, posted robust growth of 7% at constant currency.
Watches, which represent 41% of group sales and include IWC and Piaget timepieces, declined 15%, hit by inventory buybacks.
Richemont is trying to boost profitability by saving costs and rejuvenating its management team and board.
Nine new board members will stand for election in September, including former Google executive Nikesh Arora and Rupert's son Anton.
Rupert, 66, said Arora would help tackle digital challenges while his son would ensure continuity by acting as a link between management and controlling shareholders but was not, at this point, his designated successor as chairman.