Signet Jewelry stock tumbles after company cuts outlook on soft holiday sales

What you need to know

• Signet Jewelers announced weak holiday sales Tuesday and reduced its fourth-quarter outlook, sending the shares down more than 20%.
• In the 10 weeks that ended on January 11, sales at Jared, Zales and Kay Jewelers fell by about 2%.
• Signet Chief Financial and Operating Officer Joan Hilson noted that "fashion gifting underperformed as consumers gravitated to lower price points even more than anticipated in a continued competitive environment."

Signet Jewelers, the parent company of Jared Zales and Kay Jewelers, has seen its shares plummet 22% after it lowered its holiday sales forecast.

Signet’s initial same-store sales were down about 2 percent for the 10 week period ending on Jan. 11. “peak selling days leading up to Christmas that were below forecast,” Joan Hilson, Chief Financial and Operational Officer said.

Hilson noted that "fashion gifting underperformed as consumers gravitated to lower price points even more than anticipated in a continued competitive environment."

Merchandise Margin Rises Less Than Expected

Hilson also said that even though the merchandise margin rose more than anticipated, it was less than what Hilson expected. “lower fashion mix and a stronger customer response to promotional items.”

Signet’s fourth-quarter revenue forecast was lowered to $2.32 billion from its previous estimate of $2.38 billion to $2.46billion. The company expects that same-store revenue will drop by 2.5% to 2.0% compared with its earlier forecast of flat or 3%.

Signet Jewelers stock has fallen to its lowest level since 2022.

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