Signet Jewelers saw a "strong" sales performance over Black Friday, recording a high single-digit sales increase for the weekend. Despite this success, the company reports a slower-than-expected recovery in engagement ring sales, a trend Signet had predicted to boom post-COVID.
Mixed Results for Q3
During its third-quarter financial results, Signet revealed:
- Comp sales dropped by 0.7%, a marked improvement from the 3.4% decline in Q2.
- Total sales for the quarter fell by 3.1% year-on-year, landing at $1.3 billion.
Much of the comp sales decline was attributed to challenges at James Allen and Blue Nile, Signet’s digital banners, which experienced traffic and SEO disruptions following a move to a shared platform.
“It will take time to fine-tune the search algorithms and improve the customer experience,” said Joan Hilson, Signet’s chief financial, strategy, and services officer.
Bridal Trends and Lab-Grown Diamonds
Signet noted a decline in the average transaction value for bridal products but clarified that this wasn’t driven by lab-grown diamonds. In fact, lab-grown bridal jewelry boasts higher average transaction values than those with natural diamonds.
The company observed over 30% growth in lab-grown diamond fashion sales this year. Hilson explained that while lab-grown diamond prices are dropping faster than retail prices, Signet’s strategy focuses on offering branded and fashionable designs to bridge the gap.
Resilience Amid Rising Gold Prices
Despite the sharp rise in gold prices, Signet has reported “little price resistance” among its customers. The company has adjusted its pricing and engineered value-driven products to stay within the consumer sweet spot, ensuring gold sales remain robust.
Leadership and Strategic Direction
This quarter marked the first earnings call in seven years without Gina Drosos, who stepped down as CEO on November 4. Newly appointed CEO J.K. Symancyk briefly addressed the call, thanking the team for their support and emphasizing plans to refine the company’s strategic direction.
Hilson assured analysts that the leadership transition is laying the groundwork for new opportunities, with a refreshed strategy set to be unveiled in March 2025.