MW Getting engaged? There's a rising chance your ring will have a lab-grown diamond.
By Tomi Kilgore
December typically has twice the number of wedding engagements as any other month, and Signet Jewelers said lab-grown diamonds are making up 40% of bridal sales this year
Signet Jewelers said lab-grown diamonds made up 40% of its bridal business, up from a mid-30s percentage six months ago.
Forget Black Friday or even Cyber Monday - for jewelry retailers, the 10 days before Christmas are a whole lot more important.
And that's not just for holiday gift giving. According to Signet Jewelers $(SIG)$ - which is the parent of retail chains including Kay Jewelers, Zales and Jared, as well as online seller Blue Nile - December typically has twice the number of wedding engagements as any other month.
But as concerns about the economy, the recent government shutdown and stubborn inflation take a toll on the psyche of consumers, primarily those in the low- to middle-income brackets, there's a greater focus on the value they can get for their money. As a result, the percentage of wedding rings that have lab-grown diamonds is rising at a rapid pace.
For the fiscal third quarter to Nov. 1, Signet said its bridal business saw growth in average unit retail - the average selling price of items sold - of 6% from a year ago, after 4% growth in the previous quarter.
"In bridal, continued focus on differentiated offerings and strategic pricing resonated most for midtier consumers, with Kay, Zales and Peoples all delivering high-single-digit [percentage] sales growth or better," said CEO J.K. Symancyk, according to a FactSet transcript of the company's postearnings conference call with analysts.
Signet said lab-grown diamonds made up roughly 40% of its bridal business. Just six months ago, the company said that percentage was in the mid-30s.
In Signet's fashion business, the company said lab-grown diamonds made up 15% of sales in the latest quarter, or about double the percentage seen last year.
"For a set cost, LGD provides a bigger look, which can be a compelling value equation for customers that are less concerned with maintaining the value of their purchase," Signet said. "This can even lead to customers spending slightly more to achieve that incrementally bigger look."
Overall, net sales for the quarter grew 3.1% from a year ago to $1.39 billion, above the average analyst sales estimate compiled by FactSet of $1.37 billion.
For same-store sales, or sales of stores open more than a year, growth was 3%, well above the FactSet consensus of a 1.1% rise. That marked the third straight quarter of growth following an 11-quarter streak of declines.
But for the current fourth quarter, the company guided for net sales of $2.24 billion to $2.37 billion, below the FactSet consensus of $2.4 billion, and for same-store sales of down 0.5% to up 0.5%, also below analyst expectations for 0.9% growth.
Signet's stock sank more than 7% toward a three-month low in Tuesday afternoon trading. It has now shed over 14% amid a three-day losing streak, and has dropped 16% since it closed at a 17-month high of $106 on Nov. 12.
The company said it was being "cautious" about its outlook given that it has seen "softer traffic" in its stores over the past five weeks, particularly among brands with more exposure to lower- to middle-income households.
Signet noted, however, that there's still about 70% left in the quarter, and December is "a whole lot more important" than the past five weeks, as Black Friday business has little bearing on its overall results for the quarter. That overall performance is much more tied to the 10 days leading up to Christmas, the company said.
Signet also reported quarterly adjusted earnings per share, which excludes nonrecurring items, that rose to 63 cents from 24 cents a year ago, above the FactSet consensus of 29 cents. With that beat, the company raised its full-year EPS guidance range to $8.43 to $9.59, from $8.04 to $9.57.
Even with the recent selloff, the stock has gained 11.6% in 2025, while the State Street SPDR S&P Retail ETF XRT has tacked on 6.1% and the S&P 500 index SPX has advanced 16.3%.
-Tomi Kilgore
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(END) Dow Jones Newswires
December 02, 2025 15:44 ET (20:44 GMT)
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