Tiffany on Tuesday said Chinese jewelry shoppers turned out in big numbers last quarter, mitigating ongoing softness in the U.S., and the U.S. jeweler again raised its full-year profit forecast.
Global sales rose 7 percent to $911.5 million in the third quarter ended Oct. 31, above the $889.5 million that analysts were expecting, according to Thomson Reuters I/B/E/S. Comparable sales, which include those at stores open at least a year and from e-commerce, rose 7 percent.
Tiffany, famed for its robin's egg blue jewelry boxes, expects its sales momentum to continue during the holiday quarter, when it gets a third of its annual sales, with gains in every region.
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Faced with slowing growth in its two top markets of Japan and the United States in recent years, the retailer has focused on building its business in China. By the end of the fiscal year, it will have 26 stores there, up from 22 at the start.
So far, betting on the world's second-largest luxury market is paying off.
Comparable sales in the Asia excluding Japan, a region that now accounts for almost one-quarter of Tiffany's sales, rose 22 percent, well above analysts' expectations. The company is benefiting from affluent Chinese shoppers' growing preference for diamond jewelry over gold as gifts for special occasions.
But in other regions, including at home, Tiffany's sales grew more modestly.
In the Americas, comparable sales rose 1 percent, roughly in line with estimates. The jeweler attributed the increase to strong sales at its famed Fifth Avenue flagship in New York, a popular destination for foreign tourists, while other U.S. stores did not fare as well.