By Mackenzie Tatananni

Signet Jewelers stock slid after the world's largest retailer of diamond jewelry reported third-quarter sales and earnings that fell short of analysts' expectations.

The parent company of Zales and Blue Nile reported total sales of $1.35 billion, missing analysts' forecast for $1.37 billion. Adjusted earnings came in at 24 cents a share, beneath the FactSet consensus estimate for 32 cents a share.

Shares of Signet Jewelers dropped 13% to $85.86. Coming into Thursday, the stock was down 20% this year and on pace for its lowest close since Sept. 12, according to Dow Jones Market Data.

The company noted that it was hard-hit by competition in the quarter ended Nov. 2, though that was partially offset by a continued recovery in engagement-ring sales and new fashion merchandise with higher transaction values.

Net sales were down 3.1% from a year prior, while same-store sales dropped 0.7%.

The company adjusted its financial forecasts for fiscal 2025 to reflect total sales of between $6.74 billion and $6.81 billion, compared with earlier estimates of $6.66 billion to $7.02 billion. The Wall Street consensus was for $6.82 billion. Signet anticipates fourth-quarter sales of $2.38 billion to $2.46 billion, versus Wall Street's estimate of $2.45 billion.

The updated figures reflect "further integration challenges in Blue Nile and James Allen" as well as leadership transition costs, Signet said.

CEO J.K. Symancyk took the helm last month after six years with PetSmart, succeeding Gina Drosos. Shares tumbled 10% after the transition was announced in October.

The retailer highlighted the persistent integration challenges in Signet's fiscal 2024, which ended Feb. 3, describing how technical issues arose on the Blue Nile and James Allen websites and hurt sales.

At the time, Chief Financial and Operating Officer Joan Hilson said the matter was isolated to Blue Nile and James Allen and had no impact on the e-commerce channels of core brands like Zales and Kay.

As Signet fell Thursday, its biggest competitor, Birks Group, rose 0.3% to $1.59.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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December 05, 2024 10:52 ET (15:52 GMT)

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