New York: Tiffany's sales fell short this holiday season as demand from Chinese tourists decreased, stopping its forecast for year-round profits.
Fewer people found an iconic blue Tiffany & Co. box under their trees, and the net sales of the New York-based jeweler dropped 1 percent to $ 1.04 billion from $ 1.05 billion last year. .
Worldwide sales in the same stores fell 2 percent compared to the 5 percent increase in the previous holiday season.
"We attribute the difference, in part, to lower sales to foreign (mainly Chinese) tourists around the world, and to the weakening of demand attributed to local customers in America and Europe, which we believe may have been influenced more than Expected by external events, uncertainties and market volatilities, "said CEO Alessandro Bogliolo said.
Sales in the Americas, where most Tiffany stores are located, fell 1 percent to $ 514 million, as both local and foreign visitors spent less. Sales in the same stores remained the same as last year.
European sales fell 4 percent to $ 132 million, while sales at the same store fell 5 percent.
Sales in the Asia-Pacific decreased by 3 percent to $ 226 million, while sales in the same stores decreased by 4 percent. While Tiffany pointed to strong growth in mainland China, he noted that demand softened in other markets that depend heavily on the spending of foreign tourists.
Japan was the bright exception, reporting a 4 percent increase in sales to $ 150 million as local customers spent more. Sales in the same stores also increased by 4 percent.
Sales of the "other" segment, which includes five Tiffany stores in the United Arab Emirates, fell 11 percent to $ 132 million, despite having an additional location in the region this holiday season.
As of December 31, 321 Tiffany stores were in operation, five more than the previous year.
Dividing it by category, sales of jewelry collections, lines such as Tiffany T and Paper Flowers, increased by 2 percent, while sales of jewels of engagement fell by 3 percent.
Jewelry sales by designers Elsa Peretti, Paloma Picbado and Tiffany & Co. Schlumberger fell by 8 percent.
For next year, Tiffany expects earnings for the full year to be between $ 4.65 and $ 4.80 per share, at the lower end of her previous guide.
Annual sales are expected to increase from 6 to 7 percent, compared to their prior guidance of a high single digit increase.
Signet Jewelers also reported a drop in sales this holiday season and also reduced its profit forecast for the entire year.
Bogliolo, an industry veteran who took over Tiffany in July 2017, said the plan is to duplicate the six-step change plan announced in 2018, which includes "amplifying an evolved brand message" and "offering an experience to the exciting omnichannel customer. "