Total Geographic Revenue

+2.1% (from US$1,510.8M to US$1,541.6M)

Growth was driven by North America’s modest rise (US$1,420.0M to US$1,450.5M) and International revenue increasing by 3.8% (US$77.2M to US$80.1M), reflecting a partial recovery from previous integration challenges and macroeconomic headwinds. " "

North America Revenue

+2.1% (from US$1,420.0M to US$1,450.5M)

The improvement in North America revenue suggests that prior year integration and macro challenges were better managed, resulting in steadier consumer demand and a more robust sales mix compared to Q1 FY25. " " "

International Revenue

+3.8% (from US$77.2M to US$80.1M)

International revenue benefited from a modest recovery as the previous period’s challenges (including lower traffic and divestiture impacts) were partly resolved, leading to improved same-store performance and better pricing dynamics. " " "

Sales (Income Statement)

–10.7% (from US$1,510.8M to US$1,350.3M)

Although geographic revenue grew, reported sales declined sharply, likely due to differences in how sales are categorized and the impact of previously strong same-store figures; the prior period benefited from a 53rd week, which is absent in Q1 FY26. " "

Gross Margin

+4.6% increase (from US$572.4M to US$598.8M)

Gross margin expanded as improved merchandise margins—driven by higher average unit retail prices and a balanced promotional strategy—helped offset lower sales volumes compared to the previous period’s challenges with digital brand integration. " "

Net Income Attributable to Common Shareholders

Turnaround from a loss of US$40.1M to a profit of US$33.5M

A dramatic reversal was achieved by a combination of improved operational performance, enhanced gross margins, and the elimination of preferred share dividend charges that weighed on Q1 FY25, along with favorable expense adjustments relative to last year. " "

Earnings per Common Share (Basic)

Reversal from –US$0.90 to +US$0.79

EPS recovered due to lower weighted average shares following a repurchase of 2.1M shares and improved net income performance, reflecting the cumulative positive impact of operational and financial adjustments compared to Q1 FY25. " "

Total Sales ($USD Billions)

Q2 2026

no prior guidance

$1.47 billion to $1.51 billion "

no prior guidance

Same Store Sales (%)

Q2 2026

no prior guidance

Down 1.5% to up 1% "

no prior guidance

Gross Margin Rate (%)

Q2 2026

no prior guidance

Flat to up modestly "

no prior guidance

Adjusted Operating Income ($USD Millions)

Q2 2026

no prior guidance

$53 million to $73 million "

no prior guidance

Bridal & Engagement

Q4 2025 highlighted strong bridal AUR growth and a recovery outlook with strategic focus on natural diamonds. " " " Q3 2025 mentioned engagement unit recovery (albeit mixed with clearance pricing) and some digital banner drag impacting overall performance. " " In Q2 2025, the category showed stability and early recovery trends with engagement units improving and steady bridal ATV. " " "

Q1 2026 reported positive performance with continued unit growth in engagements, modest uplift in AUR, and an increased penetration of lab‐grown diamonds (LGD) in bridal (reaching mid‐thirty percent). " " "

Steady recovery with improved LGD penetration and a more balanced assortment; the current period’s performance builds on prior recovery trends, potentially strengthening future bridal and engagement performance.

Fashion Product Assortment and Margin Expansion

Q4 2025 discussed LGD fashion growth (40–60%) that drove AUR improvements but noted some inventory gaps at key price points. " " " Q3 2025 emphasized positive sales performance of new merchandise with higher margins and a premium on new fashion introductions. " " Q2 2025 focused on revenue from new merchandise and effective inventory management leading to margin expansion. " " "

In Q1 2026, the company reported sequential same‐store sales improvement, the launch of new collections (such as Stellar Allure and Wembley), and robust LGD fashion growth of 60%, all contributing to improved margin performance and a refined focus on key price points. " " " "

Enhanced focus and momentum in product assortment coupled with stronger LGD performance; earlier inventory challenges are being addressed, supporting continued margin expansion and future growth.

Gross Merchandise Margin and Pricing Strategy

Q4 2025 noted a moderate gross margin expansion with balanced pricing across bridal and fashion, despite some fixed cost challenges. " " " Q3 2025 remarked on flat merchandise margins influenced by digital banner performance and highlighted improvements via new product mix. " " " In Q2 2025, strong margin expansion (120bps) was achieved through strategic pricing and product innovation. " " " "

Q1 2026 showed a robust 100bps gross margin expansion, with merchandise AUR growing 8% overall, driven by LGD’s pricing premium and refined assortment architecture mitigating tariff impacts. " " " "

Continued and strengthened margin expansion with better pricing discipline; the current period builds on prior steady gains, signaling improved profitability prospects.

Consumer Demand Uncertainty

In Q4 2025, guidance was set with a prudent and conservative outlook due to a dynamic consumer backdrop. " " Q3 2025 cited a choppy environment with value-oriented behavior affecting engagement recovery. " Q2 2025 observed cautious engagement purchases with increased site visits indicating deliberative buying. " " "

Q1 2026 continued to incorporate flexibility in guidance with an emphasis on consumer resiliency and dynamic spending, acknowledging uncertainty while noting positive trends in key segments. " "

Persistent uncertainty, yet with a more positive tone on consumer resiliency; while caution remains, consumers are showing signs of robust spending in desired segments.

Execution Risk from Strategic Initiatives

Q4 2025 discussed store closures and repositioning with evaluation of approximately 150 underperforming doors and plans for repositioning nearly 200 stores. " " " There was no discussion of this topic in Q3 and Q2 earnings calls.

Q1 2026 provided detailed updates on the four-pronged real estate strategy involving store closures, sales transference, repositioning of healthy stores, and store refreshes, with clear execution roadmaps. "

A heightened focus on execution risk management; the current period outlines proactive and detailed restructuring initiatives, indicating a strong commitment to optimizing the retail footprint.

Tariff and Supply Chain Risk Management

Q4 2025 highlighted tariff management and centralized sourcing practices, focusing on mitigating impacts through vendor negotiations and improved transparency. " " There was no discussion in Q3 2025 and Q2 2025 on this topic.

Q1 2026 detailed a comprehensive strategy involving mitigation of supply chain disruptions by shifting Chinese manufacturing, managing incremental India tariffs, and deploying a task force to navigate tariff pressures. " " "

An enhanced, proactive approach to tariff and supply chain risks; strategies have evolved to mitigate external pressures, which could be critical for protecting margins and ensuring operational stability in the future.

Digital Platform Integration Challenges

Q3 2025 report indicated significant integration challenges including API issues, delayed replatforming, impacted digital banner performance (notably James Allen and Blue Nile), and a 120bps drag on comps. " " " In Q2 2025, difficulties with digital integration led to impairment charges and slower engagement recovery. " " Q4 2025 had no specific mention of digital issues.

In Q1 2026, the company stated that technical challenges are largely behind them, with consistent positive comps in Blue Nile; however, James Allen continues to underperform, prompting aggressive remedial action. "

Noticeable improvement in integration challenges, although residual issues remain with underperforming digital platforms; overall, the integration is stabilizing, hinting at future digital revenue recovery.

Lab-Grown Diamond Growth and Pricing Dynamics

Q2 2025 noted LCD fashion sales grew by over 25%, with continued price declines but strategic customer trade‐up to higher value pieces. " " " Q3 2025 saw moderate growth (30% in North America) and a pricing dynamic where LGD products carried 2x higher ATV. " " In Q4 2025, LGD growth was strong (up to 60% in fashion) despite inventory gaps and pricing pressures, with strategic efforts to educate consumers. " " "

Q1 2026 reported robust LGD growth, with a 60% increase in LGD fashion sales, balanced pricing dynamics driving AUR improvements, and increased penetration in both bridal (mid‐thirty percent) and overall product mix (20% overall, up five points). " " " " "

Consistent and accelerating growth in lab‐grown diamonds, with refined pricing strategies and a favorable shift in customer trade‐up behavior; LGD remains a crucial growth driver with positive implications for future revenue and margins.