Pandora A/S has revised its 2025 growth forecast lower, citing sustained weakness in North American consumer demand. The adjustment reflects broader shifts in discretionary spending and poses challenges for luxury retail and consumer discretionary sectors.
- Pandora revised 2025 revenue growth forecast to mid-single-digit from prior high single-digit outlook
- North American comparable store sales declined 8% in Q4 2024, with U.S. sales down 12%
- Adjusted EBITDA margin expected to end 2024 at 17.3%, below original 18.5% target
- Increased promotional activity by 15% in North America failed to stem demand erosion
- JWN stock dropped 3.7% on the news, reflecting broader sector concerns
- Consumer discretionary and luxury goods sectors face increased scrutiny amid shifting spending patterns
Pandora A/S has announced a downward revision to its 2025 revenue growth guidance, now projecting mid-single-digit expansion, down from prior expectations of high single-digit growth. The company attributes the slowdown primarily to softer sales performance in North America, where year-over-year comparable store sales declined by 8% in the fourth quarter of 2024. This marks a significant deterioration from the 5% growth reported in the same period in 2023. The decline in North America—Pandora’s second-largest market after Europe—signals a shift in consumer behavior, particularly among younger demographics who are reducing discretionary spending on luxury accessories. The company noted that promotional activity increased by 15% in the region during Q4, yet remained insufficient to offset underlying demand erosion. This trend is consistent with broader economic indicators showing elevated interest rates and reduced consumer confidence in the U.S. and Canada. Pandora’s adjusted EBITDA margin for 2024 is expected to end at 17.3%, below the 18.5% projected earlier, driven by higher marketing costs and inventory adjustments. The company also reported a 12% drop in same-store sales in the U.S., while Canada saw a 6% decline. These figures underscore growing pressure on luxury retail brands whose business models rely on repeat purchases and emotional engagement. The revised outlook has prompted investor reevaluation across the consumer discretionary sector. Competitors such as JWN (Jones New York) and NOKIA (in its consumer electronics segment) have seen modest share price declines, with JWN’s stock down 3.7% in early trading. Meanwhile, TSLA remains largely unaffected, as its core business is less dependent on traditional luxury jewelry trends.