But online jewelry retailer says its niche will pay off<\/p>\n
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P-I STAFF<\/p>\n
Online jewelry retailer Blue Nile Inc. reported Tuesday that profit fell 21 percent in the third quarter as consumers tightened spending, and demand for jewelry fell.<\/p>\n
The Seattle-based company would not provide its expectations for the fourth quarter and full year because of uncertainty in consumer spending patterns. <\/p>\n
“Our expectation is that this will be a very challenging holiday season based on the uncertainty in the external environment and extremely cautious consumer spending trends,” Chief Executive Diane Irvine said in a statement.<\/p>\n
Blue Nile’s biggest market is the U.S., but international sales grew 53 percent in the quarter to $6.9 million. Irvine told The Associated Press recently that some customers are pulling back on high-ticket items, partly because it has become more difficult to access credit.<\/p>\n
Specifically, Irvine said sales of the site’s most expensive items, those between $5,000 and $20,000, have been soft.<\/p>\n
“Certainly, this is a more difficult environment, especially for our engagement business. The freeze-up in the credit markets has played a role. We have a fair percentage of consumers who need to access credit,” Irvine said.<\/p>\n
Net income for the quarter that ended Sept. 28 was $2.34 million, or 15 cents per share, compared with $2.97 million, or 18 cents, in the same period last year. Wall Street analysts were expecting 16 cents per share.<\/p>\n
Sales fell to $65.4 million from $67.4 million.<\/p>\n
Despite falling sales, Blue Nile said it hopes to gain market share and to remain profitable.<\/p>\n
Irvine has said Blue Nile is poised to gain from its business model. By selling jewelry only online, Blue Nile doesn’t have the overhead costs and high inventory that come with a brick-and-mortar jewelry store. Thus, the company can sell jewelry at prices below what traditional jewelers charge.<\/p>\n
“In times like these, value resonates with consumers,” Irvine said.<\/p>\n
Blue Nile’s challenges include consumer weakness, pressure on discretionary purchases, reduced credit availability and “soft factors such as shifting cultural values,” said Edward Weller, an analyst with ThinkEquity LLC in San Francisco.<\/p>\n
He predicts that the phrase “I got it at Costco” will acquire cachet at the expense of luxury items.<\/p>\n
In other earnings news Tuesday:<\/p>\n
Timberland Bancorp Inc. reported a profit in the fiscal fourth quarter of $1.4 million, or 21 cents a share, down from $2.2 million, or 32 cents a share, a year ago. The Hoquiam-based company said it added $1.5 million to reserves for loan losses during the quarter, up from $270,000 a year ago.<\/p>\n
Timberland operates 21 branches and has $682 million in assets.<\/p>\n
Seattle-based ZymoGenetics Inc. posted a net loss of $28.8 million, or 42 cents per share, in its third quarter ended Sept. 30. That compares with a net loss of $39.0 million, or 57 cents per share, in third quarter 2007. Revenue was $11.9 million, compared with $8.5 million in the year-ago period.<\/p>\n
The company said it ended the quarter with $81.1 million in cash, cash equivalents and short-term investments.<\/p>\n
Expeditors International of Washington Inc., a freight-forwarding company based in Seattle, posted third-quarter net earnings of $85.6 million, or 39 cents per share, compared with $74.3 million, or 34 cents per share, in the year-ago period. Quarterly revenue was $1.56 billion, compared with $1.41 billion in third-quarter 2007.<\/p>\n
Peter Rose, Expeditors’ chairman and chief executive, said in a statement that the quarter’s results “show we are capable of executing effectively in the face of some rather challenging circumstances.”<\/p>\n
Source: http:\/\/seattlepi.nwsource.com\/<\/p>\n","protected":false},"excerpt":{"rendered":"
But online jewelry retailer says its niche will pay off P-I STAFF Online jewelry retailer Blue Nile Inc. reported Tuesday that profit fell 21 percent in the third quarter as consumers tightened spending, and demand for jewelry fell. The Seattle-based company would not provide its expectations for the fourth quarter and full year because of […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[411],"tags":[],"yoast_head":"\n