Sotheby’s, the worldwide public sale home purchased in 2019 by the telecommunications magnate Patrick Drahi, reported Monday that it has bought $2.5 billion of artwork and collectibles to date this 12 months.
The figures embrace greater than $285 million from online-only auctions and $575 million in personal gross sales. “The art and luxury markets have proven to be incredibly resilient, and demand for quality across categories is unabated,” Charles F. Stewart, Sotheby’s chief government, mentioned in the assertion, acknowledging the problem of promoting high-end stock throughout the coronavirus pandemic.
As a privately held firm — like its rival worldwide public sale homes Christie’s, Phillips and Bonhams — Sotheby’s is below no obligation to launch gross sales figures. It didn’t reveal in its official launch how these figures in comparison with the identical seven-month interval final 12 months, nor what revenue or loss the corporate made.
According to knowledge independently compiled by Pi-eX, a London-based artwork market analytics firm, Sotheby’s gross sales from comparatively low-value online-only auctions from January by means of July had been up 540 p.c this 12 months, however reside auctions of $1.6 billion had been down 42 p.c, ensuing in an total fall of 25 p.c in public sale gross sales. Christie’s equal on-line and reside gross sales declined by 53 p.c, based on Pi-eX.
“Auction houses release detailed sales information to remind, at times like this, buyers and consignors that the art market is open for business,” mentioned Doug Woodham, a former Christie’s president of the Americas who’s now a managing associate of the New York-based firm Art Fiduciary Advisors. “It’s impressive how Sotheby’s has been able to scrabble together so many sales. Because they’re owned by a telecoms magnate, they seemed to innovate faster than their competitors.”
The artwork market, like a lot of the worldwide financial system, has been profoundly affected by the Covid-19 disaster. Numerous artwork gala’s and auctions have been both canceled or transformed to an online-only format. So far this 12 months, Sotheby’s has held greater than 180 on-line auctions, together with the single-lot sale in May of a pair of Michael Jordan’s game-worn Nike sneakers, which sold for $560,000, more than three times the pre-sale estimate.
“Sotheby’s has been the major innovator in applying digital technologies into the auction space,” said Daniel Langer, the chief executive of the luxury strategy consultancy Équité.
In recent years, live evening auctions of high-value Impressionist, modern and contemporary art have been the prime revenue generators for international auction houses. Sotheby’s canceled its marquee May evening sales in New York, which last year grossed $692 million. These were replaced in June by a new high-tech hybrid “multicamera global livestream” auction that took in $363.2 million.
“The growth of online sales is impressive, but the key issue for Sotheby’s as well as the other auction houses is the drop in revenue from live auctions,” said Christine Bouron, the chief executive of Pi-eX. “Online sales on average still bring much lower revenue.”
Mr. Drahi’s BidFair USA acquired Sotheby’s last year in a leveraged buyout for $3.7 billion, borrowing $1.1 billion to finance the acquisition. Before the pandemic reduced turnover from live sales, the 276-year-old auction house had a net loss of $71.2 million last year. Mr. Drahi, who has a reputation for cost-cutting, reassured investors he would reach at least $66 million in savings, Bloomberg News has reported.
“Every major auction house has huge infrastructure costs associated with running their business,” said Mr. Woodham, the former Christie’s executive. “Because so many of these costs are fixed in the short term, when revenue declines, say 30 percent, profits plummet much more.”