Financials

Brilliant Earth Lowers Guidance Following Q2 Sales Dip

FinancialsAug 09, 2024

Brilliant Earth Lowers Guidance Following Q2 Sales Dip

The jewelry retailer is forecasting sales will fall as much as 14 percent in its third quarter.

Brilliant Earth and Logan Hollowell Bloom drop earrings
A pair of 14-karat yellow gold “Bloom” drop earrings set with lab-grown diamonds, pink sapphires, and emeralds from Brilliant Earth’s collaboration with designer Logan Hollowell ($3,495). The company posted declining sales in the second quarter and lowered its guidance for the year ahead.
San Francisco—Brilliant Earth has lowered its full-year guidance following declining sales in the second quarter and what it describes as a challenging environment.

For the second quarter ending June 30, the jewelry retailer posted net sales of $105.4 million, down 4 percent from $110.2 million in Q2 2023.

In the first half of the year, the company reported net sales of $202.8 million, down 3 percent from $207.9 million.

“I’m pleased with our ability to manage the business with agility and discipline in the face of a challenging industry and macroeconomic backdrop,” said Brilliant Earth CEO Beth Gerstein in a statement. 

“We delivered quality order growth, expanded gross margin, and exceeded our profitability expectations.”

Adjusted EBITDA was $5.5 million, down 29 percent year-over-year, but exceeding the retailer’s expectations.

The results were in line with the company’s forecast of a low to mid-single-digit decline in net sales and a low single-digit percentage adjusted EBITDA margin.

For the first half, adjusted EBITDA was $10.6 million, or 5 percent of net sales, compared with $13.3 million, or 6 percent of net sales, in the prior-year period.

Net income was $1.4 million compared with $1.2 million in the prior-year period.

“While the overall industry remains challenged, particularly in bridal and e-commerce, we still maintain our expectations around a multi-year path to normalization,” Gerstein said on an earnings call held Thursday evening.

She said the industry’s “highly promotional” environment has continued, noting “elevated discounting activity” among peers, a trend that persisted in Q2 and has continued into Q3.

“We remain focused on investing in quality growth and protecting our premium brand to deliver sustainable profitability and position us to take share in this highly fragmented industry,” she said.

 Related stories will be right here … 

In the second quarter, gross profit was $64.1 million, or a 61 percent gross profit margin, compared with $63.5 million, or a 58 percent gross profit margin, in the prior-year period.

In the first half, gross profit was $122.4 million, or 60 percent of sales, up 4 percent from $117.2 million, or 56 percent of sales, in the prior-year period.

The total number of orders in the second quarter rose 4 percent while the average order value (AOV) fell 8 percent to $2,374.

Repeat orders were up 17 percent year-over-year in the second quarter.

For the first half, the total number of orders rose 8 percent while the AOV fell 10 percent to $2,387.

The company has noted in previous quarters that non-bridal jewelry sales are on the rise, but the category has a lower average price point, which is bringing down its AOV.

Fine jewelry bookings in its stores increased by 29 percent year-over-year in the second quarter.

“Fine jewelry offers us an incredible opportunity to acquire lifelong customers outside of our core bridal business, and to expand our reach among both first time and repeat purchasers,” said Gerstein.

The quarter included two important gifting holidays, said Gerstein, which were Mother’s Day and Father’s Day.

Excluding holiday shopping in last year’s Q4, the company said it had its biggest ever day of fine jewelry sales in the lead-up to Mother’s Day.

Bridal jewelry sales did not fare as well.

“In Q2, what we saw was that bridal was down in the low double digits, and we have seen that slightly worsen since then,” said Gerstein.

She noted there have been some positive indicators, including bookings growth of 6 percent to view engagement ring designs in its “Signature” collection.

Bookings for wedding and anniversary bands saw double-digit growth, with men’s bands seeing 32 percent year-over-year growth. 

The company recently launched its Brilliant Earth Fairmined Bridal Collection, which uses Fairmined Gold to support small-scale mining communities.

Gerstein noted that customers are taking longer to make decisions on highly considered purchases in light of economic headwinds.

As bridal sales struggle, Gerstein highlighted the retailer’s diversified approach, like bolstering its fine jewelry offerings to reach new customers.

Though it started as an online-only business, Brilliant Earth has been expanding its brick-and-mortar network in recent years.

It is on track to open three new showrooms in the second half of the year, including two in Boston, at the Seaport and in Chester Hill, and its first street-level location in New York City’s Nolita neighborhood.

Looking to the year ahead, the company lowered its fiscal guidance.

For fiscal 2024, Brilliant Earth is now forecasting net sales of $410 million to $425 million, down from its prior guidance of $455 million to $469 million.

Adjusted EBITDA is expected to be $12 million to $16 million, down from its prior guidance of $14 million to $22 million.

For the third quarter, the company is expecting net sales to fall 11 to 14 percent year-over-year while adjusted EBITDA will either break even or have a low single-digit percentage adjusted EBITDA margin.

Chief Financial Officer Jeff Kuo said its Q4 performance is expected to be stronger than Q3 from a top-line perspective.

“Key drivers of Q4 performance will include realizing uplift from showrooms, the continued strong performance of fine jewelry, the fact that Q4 is the biggest quarter for fine jewelry sales, and our ongoing brand building efforts, including during the holidays,” said Kuo.

Gerstein said, “Since June, we’ve encountered a weaker-than-expected consumer environment, specifically for highly considered purchases, and we remain cautious for the rest of this year, given the recent headlines and economic uncertainty.”

“We recognize that this is a challenging period, and we are not immune to its impact,” she said, adding the company will continue to lean on the strength of its brand.

The Latest

GIA iD100® Technology
Supplier BulletinJul 03, 2025
Protect Your Customers and Your Business

Sponsored by the Gemological Institute of America

Madison Keys in Brilliant Earth campaign
MajorsJul 03, 2025
Brilliant Earth Names Tennis Star Madison Keys as Its New Ambassador

The 2025 Australian Open champion is the jewelry brand’s first athlete ambassador.

Muse Nordstrom shop-in-shop
MajorsJul 03, 2025
Muse Sets Up Shop in Nordstrom’s New Jewelry Hall

The West Village jewelry boutique’s new shop-in-shop is the cornerstone of Nordstrom’s revamped jewelry hall.

an instructor and a student in a bench jewelry classroom
Brought to you by
Investing in the Next Generation of Bench Jewelers

The Seymour & Evelyn Holtzman Bench Scholarship from Jewelers of America returns for a second year.

Shree Ramkrishna Exports
SourcingJul 03, 2025
SRK Announces Its Natural Diamonds Are Now Carbon-Negative

This past year, the manufacturer said it recorded below-zero emissions per carat of natural diamond.

Weekly QuizJul 02, 2025
This Week’s Quiz
Test your jewelry news knowledge by answering these questions.
Take the Quiz
Yeprem Golden Strada Statement Necklace
CollectionsJul 03, 2025
Piece of the Week: A Firework of Diamonds From Yeprem

The brand’s “Golden Strada” statement necklace features round, marquise, and pear diamonds that sparkle like Fourth of July fireworks.

Stock image of police cars with their lights on
CrimeJul 03, 2025
JSA Shares Holiday Weekend Security Tips Amid Spike in Burglaries

JSA’s Scott Guginsky provided a list of nine security measures jewelers should observe while locking up for the long weekend.

Jewelers of America logo with meetup, State of the Majors, giveaway and massages
Brought to you by
Jewelers of America is Headed to Las Vegas for JCK 2025

The countdown is on for the JCK Las Vegas Show and JA is pulling out all the stops.

Exterior and entryway of Boucheron’s Los Angeles Flagship
MajorsJul 02, 2025
Boucheron Looks to LA for First West Coast Flagship

Located on Rodeo Drive, the store’s design was inspired by Hollywood and Los Angeles culture.

Exterior of Marco Bicego Milan Flagship
MajorsJul 02, 2025
Marco Bicego Opens Milan Flagship

The new location continues the brand’s celebration of its 25th anniversary.

Chrono24 Time Is Our Thing campaign image
WatchesJul 02, 2025
Chrono24 Revamps Brand, Launches New Campaign

The online watch marketplace’s “Time Is Our Thing” campaign highlights the importance of time.

Bernadette Mack
SourcingJul 02, 2025
Bernadette Mack Joins Gem Legacy as Executive Director

She will oversee strategic planning, fundraising, industry partnerships, and the launch of the Gem Legacy Campus in Tanzania.

Counterfeit Pandora jewelry in bags and boxes
CrimeJul 02, 2025
Pandora, Amazon Partner to Uncover Counterfeit Jewelry Network

Working with Amazon’s Counterfeit Crimes Unit and law enforcement, Pandora helped to shut down a large-scale counterfeit network in China.

Cast Issa Rae
MajorsJul 01, 2025
Cast Closes Business, Plans for Relaunch

The jewelry company has closed its three California brick-and-mortar stores, as well as its online shop, for now.

Eve Goldberg, Matthew Denatale, Willie Lopez, Benjamin Goldberg
Events & AwardsJul 01, 2025
William Goldberg Diamonds, FIT Partner for Apprenticeship Program

The company is providing the opportunity for an FIT student to work alongside master diamond cutter Willie Lopez in its workshop.

Elie Hannoush
IndependentsJul 01, 2025
Elie Hannoush, Founder of Hannoush Jewelers, Dies at 73

He is remembered for his successful entrepreneurship, generosity, and dedication to his family.

Claire’s store
MajorsJul 01, 2025
Claire’s Is Looking for a Buyer, Report Says

The jewelry store chain has reportedly been struggling with costs related to tariffs as well as tough retail competition.

Mindi Mond Spike Earrings
TrendsJul 01, 2025
Amanda’s Style File: Red Hot Rubies

Welcome warm summer days with red hot rubies perfectly chosen as July’s birthstone.

The Story of Everything Campaign, Toadstool Mushroom and Cosmic Egg
CollectionsJun 30, 2025
State Property’s New Jewelry Tells ‘The Story of Everything’

Co-founders Afzal Imram and Lin Ruiyin brought their son’s story of a cosmic egg, toadstool, and railroad to life in their new collection.

Smart Age Solutions CEO Emmanuel Raheb
ColumnistsJun 30, 2025
The Smart Lab: Why Q3 Is the Secret Weapon For Holiday Jewelry Sales

The best time to prepare for the holiday season is right now, according to columnist Emmanuel Raheb.

Morgan Keefe
Events & AwardsJun 30, 2025
AGA Names Recipient of 2025 Gemological Education Scholarship

This year’s winner is Morgan Keefe, who is currently studying at GIA to be a gemologist.

The Jewelry Book
IndependentsJun 30, 2025
Melanie Grant’s New Book Explores 200 Years of Jewelry

“The Jewelry Book” comes out this September.

Gemist
TechnologyJun 27, 2025
Gemist Raises $6M in Funding to Scale Jewelry Tech Platform

The company is focused on modernizing the custom jewelry buying experience with e-commerce tools like product visualization and 3D styling.

Jeff Preolo, David Stout, Levi Higgs, David Benavides
IndependentsJun 27, 2025
David Webb Announces New Hires, Promotions

Following its recent acquisition, the storied brand has updated its leadership team and regional managers.

Blake Graham and Jessica Kohoutek
Events & AwardsJun 27, 2025
AGS, GIA Announce Beatrice Shipley Scholarship Winner

AGS also named the recipient of its “Women in Leadership” scholarship.

Buddha Mama Monstera Ring
CollectionsJun 27, 2025
Piece of the Week: Buddha Mama’s ‘Monstera’ Wrap Ring

The 20-karat yellow gold and diamond wrap ring is modeled after the Monstera plants in the garden of the brand’s Miami villa.

Cashier handing Rocksbox bag to customer
MajorsJun 26, 2025
Why Rocksbox Is Opening Stores As Signet Jewelers Downsizes

Rocksbox President Allison Vigil shared the retailer’s expansion plans, and her thoughts on opening stores in malls.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy