Tiffany & Co. (NYSE:TIF) stock is down 8.47% on Wednesday following the company’s first quarter earnings release. The company’s sales decline signals a slow recovery for the company, with demand falling in Asia and the Americas.
The company attributes lower sales to less foot traffic in stores and a slump in tourism.
Net sales reached $899.6 million on the quarter, missing expectations of $914.4 million. Same-store sales in the Americas fell 4% on the quarter, far surpassing forecasts of a 0.2% decline in same-store sales. Asian sales fell 2%, missing forecasts of a 1.4% gain on the quarter.
Tiffany & Co. (NYSE:TIF) Sales Down for Sixth Consecutive Quarter
Worldwide sales fell 3% for the sixth quarter straight, missing expectations of a 1.1% rise.
Net income was $92.9 million, beating $87.5 million in sales during the same period a year prior.
Valentine’s Day, one of the busiest shopping days of the year for the company, did little to help boost quarterly sales.
Tiffany & Co. remains confident that the company will post single-digit sales growth for the full 2017 year. Earnings are expected to climb from $3.75 a share a year ago by a mid-single digit percentage.
The company is working to increase younger consumer sales with new designs and store renovations. Tiffany & Co. is using star power to bring in younger customers, using Lady Gaga to promote the company’s HardWear collection.
The company’s slumping sales are offset by topping earnings. Tiffany & Co. (NYSE:TIF) posted $0.74 a share earnings, beating estimates of $0.70 a share earnings.
A luxury accessories collection is being muted for a launch in the fall. This is on top of plans to launch a new fragrance for women in hopes of luring in new consumers before the holiday season. The company has hired Reed Krakoff to be their chief artistic officer to help reinvigorate the company.
Krakoff is tasked with trying to turn the company around and get sales moving in a positive direction. Whether or not this can be achieved remains to be seen.
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