U.S. Luxury Jewelry Market Has Slowed Due to Reduced Plans for Spending Among High-End Buyers
Signet Jewelers stumbled in their latest earnings report, with a 7% dive in year-end revenues. Fiscal year 2025, wrapping up on February 1, saw a decline from $7.1 billion the previous year to $6.7 billion. This slump comes after a 12% drop from $7.8 billion in fiscal year 2023, as CEO J.K. Symancyk admitted during the call, "Growth has been elusive in recent years."
As the world's leading retailer of diamond jewelry and the states' largest jewelry retailer, Signet is considered a barometer of the jewelry market. Operating 2,700 stores and e-commerce sites under names like Kay Jewelers, Zales, Jared, Diamonds Direct, Blue Nile, James Allen, Banter by Piercing Pagoda, and more, the company's dismal guidance for fiscal 2026 is concerning – predicting total sales to range between $6.53 billion to $6.8 billion. Such figures imply a potential 13% drop at the high-end of guidance, or a 16% drop at the conservative estimate, compared to the past three years.
While the company focuses on expanding its market share, particularly aiming to double its 10% share of the $10 billion bridal jewelry market and boost its mid-single-digit share of the over $50 billion fashion jewelry market, Signet fell short in 2024's efforts.
Despite a 5% surge in the United States jewelry market in 2024, reaching $85.4 billion according to the Bureau of Economic Analysis, the jewelry market's picture remains muddled.
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However, the muddled picture may be shifting. The luxury market could be in for major changes in 2025, as affluent consumers, key players in the jewelry industry, become increasingly reluctant to splash cash like they once did.
Argue as you may, the broader jewelry market's growth in 2024 might have been fueled by luxury jewelry consumers carrying the momentum, while Signet's sales slid because it primarily caters to mass and aspirational consumers who tightened their belts on discretionary spending.
But the explanation isn't that simple. Competitor Pandora, battling in the same mass and accessible jewelry sector as Signet, reported a 14% revenue increase in the U.S. last year, and a 8% same-store sales growth in 2024.
On the luxury side, Richemont, a brand powerhouse boasting luxury Cartier and Van Cleef & Arpels lines, skyrocketed 15% by the third quarter ending December 31 in the Americas, amassing a whopping $4.3 billion. On the other hand, LVMH's watches and jewelry group, led by Tiffany and Bulgari, could only muster a modest 1% growth in the U.S. last year, to $2.8 billion.
Meanwhile, research firm Tenoris, which keeps tabs on 2,000 largely independent specialty jewelry stores for its market tracking, revealed sales growth was meager at 1% last year, with unit sales actually dipping 2%. The jewelry retailers they watch cater primarily to affluent clientele.
A Glimpse into the Future
Chandler Mount, founder of the Affluent Consumer Research Company, predicts the American luxury market is on the verge of a dramatic metamorphosis in 2025, driven by shifting preferences, economic factors, and evolving attitudes towards experiences, sustainability, and digital engagement.
In terms of consumer goods, jewelry stands out as the most discretionary purchase – not serving practical purposes like clothing, handbags, or watches, but instead having merely emotional or symbolic value. When affluent consumers shun jewelry, it's a grim omen for any jewelry brand or retailer.
And that's happening. Data from the ACRC longitudinal luxury tracking study among affluent consumers with incomes of $200k and above shows that intent to purchase jewelry over the next three months has faltered from 28% in the third quarter 2022 to 22% at the start of this year – meaning some 1.5 million affluent households have stopped buying jewelry in any given quarter, going from 7.3 million active buyers in 2022 to 5.8 million currently.
Mount clarifies that most affluent consumers buy luxury items quarterly or less frequently, "underscoring that luxury consumption is tied to specific needs, events, or aspirations rather than habitual purchasing."
Embracing Lab-Grown Diamonds
In jewelry purchases, the need often centers around milestone life events, holidays, and occasional gifting. However, lab-grown diamond jewelry is gaining traction as an appealing alternative to natural mined diamonds, particularly for self-purchasing and occasion gifting. But LGD jewelry is encroaching on the industry's core bridal market, where it boasts a significant cost and sustainability advantage.
According to The Knot, just over half of engaged couples surveyed in 2024 favored a LGD center stone for their engagement ring, with the average LGD ring costing $4,900 for a 1.7 carat stone, compared to $7,600 for a mined diamond ring[3]. Tenoris reports that the increased popularity of LGD caused traditional jewelry market sales to dip 3%, while LGD jewelry sales soared by 43%, with the average price decreasing by 8%.
Prioritizing Experiences over Possessions
In addition, luxury consumers are increasingly leaning towards indulging in experiences rather than material goods, and jewelry is caught in this crosswind. As Mount puts it, "Consumers increasingly prize experiences like travel and dining over physical goods, reflecting a cultural shift toward meaningful, memory-driven consumption." Thus, instead of opting for jewelry for special occasions, consumers might choose experience-creating options like cruises or luxury resorts.
Economic looming uncertainties
Looming over the jewelry market are concerns about economics. Mount highlights that affluents feel stable or better financially, but they're less optimistic about the broader U.S. economy. As a result, they're adopting a more conservative spending approach, especially when it comes to highly discretionary sectors like jewelry.
Based on Mount's assessment, the jewelry market, even at the high-end luxury segment, may experience a "notable" contraction, potentially worsening if the economic outlook doesn't improve.
"This jewelry market decline is attributed to several factors, including increased competition from lab-grown diamonds, changing consumer preferences, and economic challenges," he concludes, emphasizing the need for jewelry brands to adapt to these shifts by emphasizing jewelry's inherent value and meaning to solidify connections with customers.
- The jewelry market in the United States, despite a 5% surge in 2024, may see a notable contraction in 2025, as affluent consumers are increasingly reluctant to spend on jewelry, according to Chandler Mount, founder of the Affluent Consumer Research Company.
- As Signet Jewelers battled a 7% decline in year-end revenues in their latest earnings report, the jewelry market forecast for 2025 suggests that the luxury market could undergo significant changes, with consumers prioritizing experiences over possessions and embracing lab-grown diamonds as an alternative to natural mined diamonds.
- Research firm Tenoris, which tracks sales at 2,000 largely independent specialty jewelry stores, revealed that while the broader jewelry market grew by 1% in 2024, unit sales actually dipped 2%, hinting at a potential 16% drop in sales for jewelry retailers catering primarily to affluent clientele.
