Is the art market in for a downward dip?

Sotheby’s sold $3.1 billion worth of art in the first six months of 2019, down 10 percent from the equivalent period last year. The auction house cited uncertainties related to Brexit as one reason for the drop. The market’s wavering also comes amid the US’s ongoing trade war with China and a cooling at the top end as collectors appear less willing to chase after works priced over $50 million.

Private sales for the first half of 2019 totaled $511 million, down six percent from the first half of 2018, while auction sales were down 8.7 percent.

Sotheby’s news comes on the heels of a report from Christie’s that the auction house sold $2.8 billion worth of art at auction in the first six months of 2019, down 22 percent from last year. (It did not disclose private sales.)

In a statement, Sotheby’s CEO Tad Smith said he was “very pleased with our second quarter and first half performance.” He also noted that Sotheby’s acquisition by French-Israeli collector and entrepreneur Patrick Drahi for a cumulative $3.7 billion was proceeding according to plan (despite two lawsuits attempting to halt the deal).

Despite the dip in sales, however, the auction house reported net income of $57 million in the second quarter, roughly equivalent to its income during the second quarter of last year ($57.3 million). Sotheby’s attributed this outcome to improved auction commission margins—last year, it had suffered losses after two high-profile guaranteed works failed to meet expectations, requiring Sotheby’s to give up a portion of the buyer’s premium.

Claude Monet, Meules (1890). Courtesy Sotheby’s.

The priciest lot sold so far this year is Claude Monet’s Meules (1890), which fetched $110.7 million in May and set a new auction high for the artist. The second top lot was Pablo Picasso’s Femme au Chien (1962), sold for $54.9 million, also in May.

The auction house added that it has notable consignments in store for the fall season, including 280 works of art from the collection of Claude and François-Xavier Lalanne that will be offered over a two-day session in Paris in October with an overall estimate of $18 million to $24 million.

For art-market wonks, the release of Sotheby’s earnings report also marked the end of an era. The 275-year-old auction house will no longer be required to release such detailed quarterly and annual earnings—which offered arguably the only remaining open window into the finances of the notoriously opaque art market—when it goes private after Drahi’s acquisition. Sotheby’s expects the acquisition to close by the fourth quarter of this year.