U.S. demand was “generally soft”
Tiffany’s comps fell 8 percent during the second quarter (ended July 31), with sales tumbling in most regions, including the United States.
Worldwide net sales declined 6 percent to $932 million. Net earnings for the quarter rose 1 percent to $106 million—although they declined 5 percent compared to last year’s adjusted net earnings.
In an earnings call following the release of the financial results, director of investor relations Mark Aaron said that U.S. sales were hurt by “generally soft demand in U.S. customer spending as well as lower demand from Chinese and other tourists.”
“We believe that macro market and political uncertainties are likely playing a role in restrained consumer behavior,” he added.
Other highlights of the earnings call:
– On watches: “We’re pleased with progress in building our watch business as we intend to introduce new designs in our CT60 and East West collections,” Aaron said.
– “Our new ad campaign, Legendary Style, which will be debuting in the coming days, highlighting a few of our important jewelry collections,” Aaron said. “Created in collaboration with fashion visionary Grace Coddington, this campaign features women of style and substance known for their unique points of view wearing iconic Tiffany designs.”
– Engagement jewelry and wedding bands saw a modest drop. Statement jewelry was the weakest performer.
– The company has made progress with fashion jewelry, with “some moderation” in sales declines, Aaron said.