In a bid to fortify its digital presence, Signet Jewelers, the world’s leading retailer of diamond jewelry, has announced robust investment plans aimed at facilitating digital transformation.
The company has earmarked between $160 million to $180 million for capital expenditures this fiscal year, with a significant portion allocated towards digital and technology enhancements.
Signet Jewelers aims to spend $40 million to $50 million in 2024 in digital and technology in support of enhancing experience of consumers and team member. Howard Melnick is the Chief Information Officer (CIO) of Signet Jewelers, accountable for developing and implementing global IT strategies that enable business value.
According to Signet Jewelers, the investment will encompass the establishment of 20 to 30 new stores, alongside the renovation of approximately 300 locations, including 200 Kay stores, 50 Jared locations, and 6 Diamonds Direct stores. These efforts are geared towards elevating the overall customer experience within their retail ecosystem.
Gina Drosos, the Chief Executive Officer of Signet Jewelers, underscored the challenges confronting the company’s digital business, citing operational and integration issues that have led to suboptimal fulfillment rates. These challenges have persisted into fiscal 2025, prompting the company to redouble its efforts towards resolution.
The decline in digital sales has been primarily attributed to the integration of Blue Nile with production partners, resulting in diminished conversion rates during the latter part of the quarter. Despite this setback, Signet Jewelers maintains that its core e-commerce channels continue to perform admirably, unaffected by the integration issues.
Looking ahead to the first quarter, Signet Jewelers anticipates total sales ranging between $1.47 billion to $1.53 billion, with same-store sales projected to decline by 11 percent to 7 percent. Notably, the company expects a 2-point negative impact on same-store sales attributable to digital issues stemming from the James Allen and Blue Nile integration.
In terms of fiscal outlook, Signet Jewelers anticipates operating income to fall within the range of $590 million to $675 million, with adjusted EBITDA expected to range from $780 million to $865 million. These projections reflect the company’s concerted efforts to drive cost savings, leveraging artificial intelligence and streamlining non-customer-facing expenses.
Despite the anticipated challenges, Signet Jewelers remains optimistic about the trajectory of its digital initiatives, emphasizing its commitment to resolving integration issues and enhancing the overall customer and team member experiences. The company anticipates a gradual recovery in the second half of the year, although the resolution of integration issues is not factored into its revenue guidance.
Rajani Baburajan
