Signet Jewelers’ disappointing holiday results had a dampening effect on the industry’s mood. Same-store sales at the US’s largest diamond retailer fell 2% for the 10 weeks that ended January 11. The company slashed its guidance for the fiscal fourth quarter. Its share price fell 22% in one day.
What the results indicated, however, was not so much sluggish consumer demand as a complex US jewelry market that has forced retailers to strategize carefully.
The key issue for Signet was product range, the jeweler’s new CEO, J.K. Symancyk, said at the ICR Conference 2025 on Tuesday, a few hours after the sales announcement.
The company suffered from “assortment gaps” in fashion jewelry at the types of price points that appeal to gift-givers, Symancyk said. This problem was visible in the 10 busy days running up to Christmas.
More specifically, the executive explained, consumers were entering stores or websites in search of lab-grown diamond fashion jewelry, and Signet was not able to fulfill this.
Consumer demand exists for the sub-$1,000 and especially the sub-$500 price points, but Signet needs to “amplify lab-created diamonds more in that space,” he added.
“Yes, it was a competitive environment, and yes, there are some challenges that I think consumers are navigating in the macro, but the truth is we didn’t see people trade down. What we saw is desire for bolder fashion in those gifting price points. And some of those stories — be they gold or lab-created diamonds — we were under-allocated relative to our assortment.”
Fashion jewelry is typically the company’s top seller in the fourth fiscal quarter — which ends in late January — as shoppers seek holiday gifts. Bridal is the biggest segment for the other three quarters.
Independents vs. majors
News that Signet didn’t have enough lab-grown diamonds to meet all the demand might further weaken sentiment in the natural sector, which still feels unsure about how the holiday season really went for mined goods.
Initial data and anecdotal reports indicate smaller businesses had a better season than large chains. Gross sales at independent retail jewelers rose 6% year on year in December, the Edge Retail Academy reported in a LinkedIn post. Diamond sales increased 4%, though it did not break this down by natural and lab-grown.
“Independent jewelers demonstrated remarkable resilience and performance during the holiday season, reflecting the strong consumer demand and strategic adjustments in inventory and pricing,” the post read.
The current difficult retail environment has put pressure on the mid-market, hitting big-box retailers as customers reduce discretionary spending, said David Bonaparte, president and CEO of trade body Jewelers of America (JA).
“The independent market reacted quite differently,” Bonaparte commented. “The upper 1% of earners are still spending on luxury goods, as the stock market has remained strong through 2024.”
Devil in the details
The independent sector is varied, and not everyone performed well. Those that had the right product in stock did well, said Roger Forman, president of The Plumb Club, a coalition of suppliers to America’s jewelry, diamond and watch retailers.
“The devil is in the details,” he added. “[Independents] where the people really manage their stores carefully and cultivate the relationships with those customers — they’re the ones that that do better.”
Forman believed the holiday season was a “mixed bag” for the majors. “There was a trend, particularly in bridal, toward more lab-grown and away from naturally mined diamonds,” he continued. “So companies that had positioned themselves to take advantage of that did better than those that did not.”
Large stud earrings were also strong, mainly in lab-grown, he said.
Value, volume and lab-grown
Another trend of the season was higher values alongside lower volumes. December’s 6% rise in sales value at independents came despite a 5% decline in unit sales, with the average retail sale rising 12%, according to the Edge’s data. For diamonds, unit sales were steady, with the average retail sale up 5%.
Data provider Tenoris had similar numbers: Total jewelry sales rose 3.4% year on year in December despite unit sales falling 3.5%, it said. The average price per unit climbed 7.2%.
This shift partly reflects growing demand for synthetics at the lower segment of the market, said Edahn Golan, owner of Edahn Golan Diamond Research and Data and a partner in Tenoris. “The bottom end of consumers that used to buy natural is now buying lab-grown,” said Golan. “So the low-cost natural-diamond items are out of the equation. That pushes up the average.”
Lab-grown saw the opposite trend from the rest of the market: Unit sales growth of 43% in 2024 as a whole outpaced the 31% increase in sales value, according to Tenoris. This goes hand in hand with another reality: The falling price of synthetics at the consumer level has reduced the incentive for retailers to sell the category.
“Consumers want a product that retailers would really rather not sell,” said Golan. “That is why when you walk into stores, and you say, ‘I want to buy a diamond ring,’ they will not volunteer the question, ‘Lab-grown or natural?’ The smart ones will automatically steer you toward a natural one from an economic standpoint. If the consumer would prefer to have lab-grown, they will try to talk you out of it.”
Image: The interior of a Zales store. (Signet Jewelers)
