Brilliant Earth’s 2024 Sales Struggled Amid Engagement Recovery

San Francisco—Brilliant Earth posted declining revenue in Q4 and for the full year, though it saw a rise in total orders and growing demand for its non-bridal fine jewelry offerings.

The San Francisco-based retailer is celebrating its 20th anniversary this year.

On an earnings call Wednesday evening, CEO Beth Gerstein said, “We continue to operate in a highly dynamic environment encompassed by pricing shifts in both lab and natural diamonds, normalizing engagement trends, and changing trends in consumer sentiment.”

Gerstein noted that Q4 marked its 14th consecutive quarter of profitability as a public company.

Net sales in the fourth quarter, which ended Dec. 31, were down 4 percent year-over-year to $119.5 million, with net income up 35 percent to $2.6 million.

Gross profit was $71.2 million, or a 60 percent gross profit margin, compared to $73 million, or a 59 percent gross profit margin, in the prior-year period.

The total number of orders in the fourth quarter rose 10 percent to 58,357 orders, though the average order value (AOV) fell 13 percent year-over-year to $2,048.

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

The brand’s holiday performance, included in Q4, exceeded its expectations, said Gerstein, particularly during Cyber Week, both online and in stores.

Black Friday was its biggest day for appointment bookings in company history, she added.

For the full year, the company saw net sales down 5 percent to $422.2 million, with net income down 16 percent to $4 million.

Gross profit for the fiscal year was $254.4 million, or a 60 percent gross profit margin, compared to $257 million, or a 58 percent gross profit margin, in the prior year.

Total orders were up 7 percent year-over-year to 186,030 orders, but AOV was down 11 percent to $2,269.

Customers are returning to shop with the jeweler more than once, with the company noting repeat orders grew 18 percent year-over-year in Q4 and 17 percent for the full year.

“This trend reaffirms the resonance of our strong brand and compelling product designs. As more consumers discover our joyful shopping experience, it’s gratifying to see them returning time and time again, especially in a peak gifting quarter,” said Gerstein on the call.

Brilliant Earth is best known for its bridal offerings but has been expanding its fine jewelry selection, branching out into cocktail rings and men’s jewelry.

It has also collaborated with popular designers for new collections, including Tacori, Jade Trau, and Logan Hollowell. Its recent partnership with Jane Goodall was its most successful fine jewelry collaboration to date, said Gerstein.

It was a “banner quarter” for non-bridal fine jewelry, said Gerstein. The most popular styles included diamond tennis jewelry, diamond studs and hoops, and jewelry from its “Sol” collection.

Brilliant Earth also expanded its “under $1,000” assortment to appeal to those buying holiday gifts for others or themselves. 

The company said its showroom bookings for fine jewelry grew double digits in Q4, accounting for a record 27 percent of appointments in December.

Fine jewelry has been a bright spot for its balance sheet as engagement ring sales continue to struggle in the wake of the COVID-19 pandemic.

Looking at the bridal market, the average selling price for engagement rings was down in Q4, said Gerstein, noting that Brilliant Earth saw a stronger performance in price ranges under $5,000, a price point where it has seen the strongest consumer demand.

However, she noted the best year-over-year units comp for engagement rings in Q4 compared to other quarters this year.

“We believe the trajectory of our bridal business can be improved over last year as we amplify our brand with continued success in differentiating designs, diamond leadership, and an industry-leading omnichannel experience,” said Gerstein.

Its signature bridal collection did especially well, she said, adding that it recently introduced the new “Flawless” collection, featuring flawless and internally flawless diamonds.

Gerstein also highlighted its “Rethink Everything You Know About Diamonds” campaign, which challenges customers to change their perceptions about diamonds and emphasizes the impact their choices have on communities and the environment.

Though it started as an online-only business, Brilliant Earth has been expanding its brick-and-mortar presence in recent years, ending 2024 with 40 locations.

The company plans to open two to three new showrooms this year, including its most recent showroom opening in Southlake, Texas.

Looking to the year ahead, the company is expecting first-quarter net sales of $93.5 million to $95.5 million with adjusted EBITDA of $0 to $1.5 million.

For fiscal 2025, Brilliant Earth is forecasting net sales growth of 1 to 3 percent year-over-year with an adjusted EBITDA margin of 3 to 4 percent. 

The company will continue to make medium and longer-term investments in 2025, including in employee costs as it continues its expansion, said Chief Financial Officer Jeff Kuo on the call.

“We believe that these investments, including in our premium brand, product assortment, and innovative omnichannel experience, drive compelling [return on investment] and will begin to show returns starting in the second half of 2025 and beyond,” said Kuo.

The company previously stated its medium-term target is to see a net sales growth rate in the low-teens with double-digit growth in its adjusted EBITDA margin in 2027.

The company also released its 2024 Mission Report, highlighting its commitment to “transparency, sustainability, compassion, and inclusivity.”