Signet Jewelers Reports 2% Sales Increase but Declines in Net Income for Q1 Fiscal 2026

Signet Jewelers Limited reported its financial results for the first quarter of Fiscal 2026, ending May 3, 2025, revealing a total sales increase of 2.0% to $1.54 billion compared to $1.51 billion in the same period last year. Merchandise sales rose to $1.35 billion, up from $1.33 billion, while service sales also saw an increase to $191.3 million from $184.5 million. However, net income decreased to $33.5 million, or $0.78 per diluted share, down from $52.1 million, or a loss of $0.90 per diluted share in the prior year, primarily due to restructuring charges and increased selling, general, and administrative expenses.

The company experienced a notable shift in its operational metrics, with same-store sales growth of 2.5%, a significant recovery from a decline of 8.9% in the previous year. The increase was attributed to improved average unit retail prices in bridal and fashion categories, although performance was dampened by underperformance in the James Allen brand. E-commerce sales remained stable at $338.7 million, accounting for 22% of total sales, slightly down from 22.4% in the prior year.

Strategically, Signet has initiated its "Grow Brand Love" transformation strategy, which aims to enhance brand loyalty and drive sustainable growth. This includes optimizing its store footprint and focusing on key brands such as Kay, Zales, and Jared. The company closed 14 stores during the quarter, resulting in a total of 2,633 retail locations as of May 3, 2025. The restructuring plan has led to charges of $22.2 million, which significantly impacted the operating income, which fell to $48.1 million from $49.8 million in the previous year.

In terms of liquidity, Signet reported cash and cash equivalents of $264.1 million, a decrease from $729.3 million a year earlier, primarily due to the retirement of preferred shares and the repayment of senior notes. The company has no outstanding debt and maintains a senior secured asset-based revolving credit facility with an available borrowing capacity of $1.1 billion. Looking ahead, Signet anticipates same-store sales to fluctuate between a decline of 2.0% and an increase of 1.5% for Fiscal 2026, as it navigates a challenging consumer spending environment influenced by macroeconomic factors such as inflation and geopolitical tensions.