Tiffany & Co. (NYSE: TIF), which is in the process of being acquired by LVMH, reported better than anticipated third quarter results on Tuesday. The jeweler experienced a sales increase of 70% in China and a steadily growing demand within the U.S.
“We had a strong third quarter …. which speaks volumes about the enduring strength of the Tiffany brand and gives us confidence as we enter the important holiday season,” Chief Executive Officer Alessandro Bogliolo said, nodding to “the successful completion of the merger transaction with LVMH in early 2021.”
Amid the global pandemic, the positive results give hope within the luxury retailer industry. The increase in sales in China also indicates the necessity of sales within the mainland in order to reduce reliance on tourism.
Furthermore, last month Tiffany and LVMH ended their ongoing legal battle and approved a new agreement that stipulates the french multinational corporation will acquire the U.S. jeweler for a moderately lower price of USD15.8 Billion.
Tiffany revealed that sales shot up 30% in the Asia-Pacific region, though sales in America fell 16%, lower than last quarter’s 46% decline. The company anticipates a mid-single-digit percentage drop regarding holiday sales, though analysts estimate a 3% fall. Nevertheless, Tiffany’s foresees a high-single-digit percentage increase in earnings for the current quarter.
Despite 60% of Tiffany’s European retail locations temporarily closed, analysts remain confident in its recovery.
“Q3 results also reiterate our confidence that the Tiffany brand will continue to shine through the holidays,” said CFRA analyst Camilla Yanushevsky.