Shares of Tiffany & Co. fell more than 3 percent Friday after the upscale jeweler reported second-quarter earnings that met analysts’ expectations but revenues that fell considerably short of them.
Net income for the three months ended July 31 rose 19.2 percent to $67.7 million, or 53 cents a diluted share, from $56.8 million, or 46 cents, in the year-ago quarter. Sales climbed 9.2 percent to $668.8 million from $612.5 million.
While earnings per share — brought down 2 cents by a charge to cover the upcoming relocation of the firm’s New York-headquarters staff — matched consensus estimates, revenues came up shy of the $690.2 million Wall Street had anticipated. Despite an upward revision in EPS guidance by the company, the sales shortfall contributed to a $1.33, or 3.2 percent, decline in the company’s shares to $40.71 on a day when the Dow Jones Industrial Average retook the 10,000 level, rising 1.7 percent to 10,150.65, and the S&P Retail Index advanced 1.1 percent to 405.82.
Quarterly sales in the U.S., Canada and Latin America rose 8 percent to $350.4 million, while comparable-store sales in the U.S. gained 5 percent. Sales in the New York flagship rose 8 percent. However, Internet and catalogue sales in the Americas fell 2 percent, the company said. In the Asia-Pacific region, sales rose 21 percent to $111.5 million. The company said sales in Japan rose 4 percent to $118 million. In Europe, sales increased 14 percent to $76.9 million. “Other sales” declined 19 percent to $11.9 million, mostly because of the depressed market for rough diamonds.
Gross margin advanced to 57.8 percent of sales from 55.1 percent a year ago on a combination of manufacturing efficiencies, higher prices and a decline in the wholesale sales of rough diamonds.
Michael J. Kowalski, chairman and chief executive officer, emphasized the firm’s increasingly global profile. “Tiffany’s financial performance in the quarter continued to demonstrate the benefits derived from a growing global presence, with roughly half of our sales now occurring outside the U.S.,” he said.
He noted that, so far in the third quarter, worldwide sales were growing at a low-double-digit pace.
On tap for the second half, which the ceo said is being approached with a sense of “guarded optimism,” is a collection of jewelry with yellow diamonds, as well as other new products.
The company raised its EPS forecast for the year to between $2.60 and $2.65 a diluted share for continuing operations from previous guidance of $2.55 to $2.60. Analysts had previously penciled in $2.61.
For the six months, income jumped 62.9 percent to $132.1 million, or $1.03 a diluted share, from $81.1 million, or 68 cents, a year ago. Sales rose 15.2 percent to $1.3 billion from $1.13 billion.
@fearofgod and @maxfieldla have teamed up on a pop-up installation. The store, located in the gallery space across from Maxfield’s Melrose Ave location, is the site of the brand’s House of God pop-up in which Fear of God founder @jerrylorenzo has created a church-inspired installation. A dozen vintage church pews sit in front of an LED screen playing 90s gospel singers in an effort to re-create an environment akin to a Southern Baptist Church, Lorenzo explained. Read more about the pop-up on WWD.com #wwdfashion (📷: Jennifer Johnson)
Known for his sleek, sophisticated American glamour, Norman Norell is the subject of an upcoming exhibition at @fitnyc. “Norell: Dean of American Fashion,” which runs from February 9 through April 14, will feature approximately 100 ensembles and accessories. His best work is exemplified by the designer’s glittering “mermaid” gowns frosted with thousands of hand-sewn sequins – like the one pictured. (📷: William Helburn) #wwdfashion
For pre-fall 2018, @balmain didn’t let go of the glitz. A crystal embroidered baseball jacket priced at around $40,000 hangs in the “couture” section of the brand’s first men’s pre-collection. Sporting the words “Balmain Army” across the back, the item took around two months to make. “When it was completed, it was like Christmas, it was like, ‘It’s done, it’s exactly what I wanted,’” said Balmain’s creative director @olivier_rousteing during a tour of the collection in a Paris showroom on Monday. #wwdfashion
Eighty degree temperatures and outdoor installations at the annual Art Basel Miami Beach called for bright, elevated beachwear. See more street style pictures on WWD.com. #theyarewearing #ABMB (📷: @lifeinreverie)
Following September’s emotional tribute to her brother Gianni, Donatella Versace wanted to bring the spring show’s deep sense of intimacy to her @versace_official pre-fall collection. Donatella found inspiration in Versace Palazzo in Milan and from Gianni’s opulent apartment. Archival patterns and new motifs were splashed on silk shirtdresses and fitted jersey frocks. See the rest of the photos on WWD.com. #wwdfashion
Demna Gvasalia continues to shake up the Paris fashion calendar — and experiment with new runway timetables for his @vetements_official brand. WWD has learned that Vetements plans to stage its next coed show for the fall 2018 season on January 19 during Men’s Fashion Week in the French capital. Details about the timing and venue have not been confirmed — stay tuned on WWD.com to catch the latest. #wwdnews (📷: @giovanni_giannoni_photo)
@zacposen's go-to holiday gift? Cookies! "I'll usually bake cookies and send them as a gift," said the designer, who recently released his cookbook "Cooking With Zac: Recipes from Rustic to Refined." Get the recipe for his Brown Butter-Chocolate Chip Cookies via link in bio 🍪🍪🍪 #wwdeye #cookingwithzac
For @monsemaison’s pre-fall 2018 collection, Fernando Garcia and Laura Kim honed in on the brand’s many signatures — men’s wear, which was tweaked and feminized through deconstruction, proportion play and lots of bare shoulders. See the rest of the photos on WWD.com #wwdfashion (📷: George Chinese)
On Friday night, @yohjiyamamotoofficial received the Design for Asia Lifetime Achievement Award in Hong Kong. The 75-year-old designer has been celebrated for many years and is best known for his dark and avant-garde tailoring. “In my long career, in design, architecture, [I’ve been to] so many parties, this is the very first time that I have such a warm feeling, I really appreciate this,” Yamamoto said. #wwdfashion (📷: @dominiquemaitre)