(Reuters) - U.S. jewelers Tiffany & Co (TIF.N) and Signet Jewelers Ltd (SIG.N) reported bigger-than-expected quarterly sales and profit, helped by strong demand for their high-margin bracelets, rings, necklaces and branded jewelry.
Shares of Signet rose 23 percent to $63.74 in morning trading, while Tiffany was marginally up at $88.77.
Tiffany attributed its sales growth to strong demand for its high-end jewelry, such as the Tiffany T collection, while Signet said higher-priced branded jewelry sold better than lower-priced brands.
While shoppers have been shunning traditional jewelry such as solitaire engagement rings, there has been a marked shift towards brands that offer a more contemporary look such as the Tiffany Hardware collection and products from Pandora A/S (PNDORA.CO), which are sold at Signet’s Jared stores.
Tiffany signed on pop star Lady Gaga to launch the Tiffany Hardware collection, which features items like the $13,500 Wrap necklace in 18k gold, while Signet sells items like the $10,999 Le Vian diamond earrings in 14k pink gold at its stores.
Danish jeweler Pandora’s shares were up 2 percent in Copenhagen.
New York-based Tiffany said it also benefited from higher sales of wholesale diamonds and increased spending in Japan.
Tiffany and Signet have shaken up their management and hired outsiders to fill important roles such as CEOs and chief designers, to give their brands a new look.
Signet’s new Chief Executive Virginia Drosos started her role earlier this month, while Tiffany’s new CEO Alessandro Bogliolo will join in October this year.
Tiffany’s earnings came in at 92 cents per share, while Signet reported a profit of $1.33 per share. Both the retailers beat analysts’ average estimates by the widest margins since October last year.
Tiffany, which gets about 15 percent of its revenue from Japan, said overall sales rose 3 percent to $959.7 million in the reported quarter, while Signet’s rose 1.9 percent to $1.40 billion.
Analysts on average had expected Tiffany to post sales of $930.3 million and Signet $1.33 billion, according to Thomson Reuters I/B/E/S.
Separately, Signet also said on Thursday that it would buy parent company of online jeweler JamesAllen.com R2Net, for $328 million on Thursday.
Reporting by Gayathree Ganesan and Siddharth Cavale in Bengaluru; Editing by Shounak Dasgupta