Sothebys (NYSE:BID) had a strong second quarter that masks the company’s current struggles in the art market.
The company admits that it’s had a difficult time in its business of auctioning pricy works of art, but it was able to counteract these losses with certain initiatives that will benefit Sotheby’s in the long run.
A Chinese life insurance company acquired a 13.5% stake in the auctioneer, seeking a board seat and looking to boost the company’s business in the long run.
Sotheby’s reported earnings of $1.52 a share for the quarter, surpassing the $1.04 a share that Wall Street had projected. Additionally, revenue came in at $298.7 million, topping the consensus estimate by $16.2 million.
The company’s strong quarter helps to soften the blow of its first quarter, when the company reported a loss of $26 million (its income was a gain of $89 million this quarter). Many art dealers are holding out on their luxury products, or choosing to sell via private auctions rather than through Sotheby’s.
The current quarter is slated to fall below expectations due to these reasons, but the company expects to turn things around for its fourth quarter.
Despite these shortcomings, Sotheby’s has been setting records in the market, including the $63.6 million sale of a 1909 Picasso painting “Femme Assise.”
In January, the company acquired Art Agency, Partners for $85 million in a bid to improve its art advisory experts.
BID shares soared 15.1% Monday.
