In recent art world news, Sotheby’s reported a $57.3 million net income in the second quarter of this year in a recent earnings call earlier this week. This figure represents a decrease of $19.6 million or about 26% in comparison to the same period last year when the auction house reported that it had $76.9 million in net income.
Sotheby’s attributed the decline in part to a change in its auction calendar as some sales in Hong Kong occurred in the first quarter instead of the second quarter. The auction house also attributed the decline to a decrease in its auction commission margin.
While consolidated sales increased 22 percent to $3.5 billion, which represents some of the highest amounts in Sotheby’s history, there was a decline in its auction commission margin. This was due to a competitive environment for high-value lots that resulted in “a higher level of auction commissions shared with consignors” under such circumstances.
Notwithstanding the above, sales in Asia remained strong as aggregate auction sales for the first half of the year totaled $488 million, representing a 15 percent increase in 2018.
Although the tone of the earnings call was downcast and the financial results were lower than expected, the auction house’s management and board are “excited as ever about the company’s prospects going forward.”
It is certainly nice to see the earnings call end on an optimistic note in view of the disappointing second quarter financial results.