Pandora’s hit jewelry product is now its biggest problem


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These founders want to make lab-grown diamonds mainstream

This is the factor about fads: They finish.

Pandora (PANDY), which makes extra jewellery than some other firm, is being slammed as individuals lose curiosity in its charms, the ornamental trinkets which can be typically hooked up to bracelets.

The Danish firm has in recent times turn out to be synonymous with charms, which make up over half of its gross sales. However their recognition is fading, and Pandora hasn’t been in a position to revive it.

Pandora’s inventory has been reduce in half this 12 months, and the corporate stated Thursday that CEO Anders Colding Friis would step down on the finish of August.

The announcement caps a tumultuous few days for the corporate.

Pandora inventory crashed 24% on Tuesday after the agency slashed its gross sales forecast for 2018. On Thursday, it reported that attraction gross sales declined 7% within the first quarter.

“They should repair the charms problem,” stated Soeren Loentoft Hansen, a senior analyst at Sydbank. “The enterprise is essential as a result of it drives site visitors to the shops.”

pandora bracelet

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The corporate has pinned the blame on a shift to minimalist fashions.

“We have been too optimistic concerning the new merchandise from our charms collections,” Colding Friis advised traders throughout a convention name on Thursday. “Shoppers are preferring a easy look with fewer charms. They used to put on six to seven charms, now they put on 5.”

Loentoft Hansen would not purchase that clarification. He says individuals simply don’t love Pandora’s designs.

“I’m not nervous about charms enterprise normally, however I’m little nervous about Pandora’s attraction enterprise,” he stated.

Associated: De Beers admits defeat over man-made diamonds

Anders Boyer, who was lately named chief monetary officer at Pandora, acknowledged that the corporate was going by way of “a really tough interval.” However he stated he is optimistic.

“Pandora is right here to remain. Pandora shouldn’t be a fad,” he stated. “I do not see something on the contrary after I look into the numbers.”

Loentoft Hansen stated that whereas charms are essential, the corporate should construct its enterprise in different jewellery segments.

Bracelets contribute virtually 20% of Pandora’s gross sales, whereas all different jewellery — rings, earrings, necklaces and pendants — make up lower than 1 / 4.

CNNMoney (London) First printed August 9, 2018: 11:07 AM ET

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