Challenges Ahead for Signet Jewelers as Fiscal 2024 Results Disappoint

Signet Jewelers Stock Declines on Weak Fiscal 2025 Guidance

The jewelry retailer offered disappointing guidance for its fiscal 2025. Shares of Signet Jewelers (NYSE: SIG) were losing their luster on Wednesday after the world's largest retailer of diamond jewelry posted solid results for its fiscal 2024 fourth quarter but offered disappointing guidance for fiscal 2025.

Waiting for engagements to bounce back

In its fiscal fourth quarter, which ended Feb. 3, same-store sales fell 9.6%, driving revenue down 6.3% to $2.5 billion. That missed the analysts' consensus of $2.55 billion. Despite the falling revenue in a challenging macro environment with weak consumer discretionary spending, gross margin in the quarter expanded by 160 basis points to 43.3% due to improving merchandise margins.

• Adjusted operating income rose 1.2% to $409.7 million, giving Signet an operating margin of 16.4% in the seasonally strong quarter.
• Guidance disappoints

Investors were also disappointed with the company's guidance, as the recovery from engagements is expected to be weighted toward the back half of the fiscal year. For the fiscal first quarter, the company expects revenue of $1.47 billion to $1.53 billion, below analysts' average estimate of $1.61 billion, and anticipates a same-store sales decline of 7% to 11%.