Pandora said it would expand its network of stores in the United States, including possibly adding more multi-brand retailers.
“There is a lot of white space [in the United States],” Pandora CEO Alexander Lacik said on a conference call following the the Danish company’s release of its financial results for the third quarter of 2024.
Pandora reported 6% comp growth in the U.S. over the third quarter of 2023, with total sales rising 14%, driven by new store openings.
The brand reported mixed results for its lab-grown diamond collection, with that segment’s revenue falling 25% overall, even as like-for-like revenue increased 35%. Lab-grown represents about 1% of Pandora’s sales.
Pandora spokesperson Johan Melchior tells JCK the discrepancy between comps and revenue stems from “when we expanded the assortment last year, our partners needed to build up an inventory from scratch. They don’t this year.”
On the call, Lacik noted that Pandora was introducing a collection called Microfine, featuring smaller lab-growns.
“The large proportion of customers tend to come in on the lower carat sizes,” he said about the new line. “So two-thirds of our customers are buying on the opening price points, rather than the bigger stones. Which is quite understandable: I appeal to the average income household; they don’t spend go and splash out $2,000 to $3,000 on a diamond ring. But spending $300, $400 seems more of a volume business.”
Lacik stressed that Pandora remains “fully committed” to lab-grown.
“It’s a long game for us. It’s a new segment, it’s a new price point. It is a different purchase experience than we do on charms or the other items.”
The call was dominated by questions regarding rising silver costs, which the company said had caused it to raise prices and could also dent margins.
“We won’t be compromising our brand promise of being accessible,” said chief financial officer Anders Boyer. “It is quite a margin headwind, but we are addressing it and we are addressing it forcefully.”
Lacik said Pandora had seen more promotional pricing from its competitors during the quarter, singling out “a company in Austria which had a mid-quarter sale” in the U.K.—a seeming reference to Swarovski.
Globally, Pandora posted organic growth of 11% and like-for-like growth of 7%.
(Photo courtesy of Pandora)
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