On November 24, Tiffany & Co. released one of its last earnings reports before being taken over by LVMH. The famed New York high-end jeweler reported net earnings of $119 million in the third quarter, up from $78.4 million in the same period a year ago. Sales rang in at $1.01 billion, down just slightly from a year ago but still above analysts’ estimates of $972.5 million.
Moreover, Tiffany’s comparable store sales in constant currency terms jumped 36% in the Asia Pacific Region, offsetting a 14% drop in the Americas, as well as a 9% drop in Europe and a 5% decline in Japan. “Sales in Mainland China continued to grow dramatically in the third quarter increasing by over 70%, with comparable sales nearly doubling in that period as compared to the prior year,” CEO Alessandro Bogliolo said in the statement.
Back in June, Tiffany announced that Jackson Yee, the popular Chinese singer, dancer, and actor, would be the brand ambassador of its iconic Tiffany T collection. As one of the top-tier Chinese male idols, Yee holds a huge influence among Chinese millennials and Gen Zers, with a whopping 84.6 million Weibo followers. Tiffany’s campaign post with Yee has garnered over one million reposts and engagements. It is clear the effort of leveraging celebrity power has paid off for the luxury jeweler.
Aside from the strong support from Chinese buyers, online channel also contributed to Tiffany’s third quarter sales. The ongoing COVID-19 crisis also forced the New York-based retailer to invest more in its online business and to introduce curbside pick-up at certain stores. This helped e-commerce sales surge 92% in the quarter.
While Tiffany shares plunged in September after the jewelry company said it planned to sue French fashion giant LVMH over stalling and then reneging on its proposed $16 billion takeover offer, the two companies finally cut a new deal last month, which is expected to be finalised in early 2021.
Mr. Bogliolo adds: “We had a strong third quarter both in sales on a relative basis and terrific results in profitability on an absolute basis, which speaks volumes about the enduring strength of the Tiffany brand and gives us confidence as we enter the important holiday season.”