Tiffany CEO quits amid jewelry chain sales drop

Tiffany & Co. announced on Sunday that its chief executive, Frédéric Cumenal, is resigning and that the luxury jeweler is looking for a new leader to reverse the prolonged drop in sales.

The New York-based company said Mr. Cumenal, who has led Tiffany for the past two years, will be replaced, with immediate effect, by his predecessor, company president Michael Kowalski.

Tiffany said its board of directors was “committed to our current core business strategies, but has been disappointed with the recent financial results.” The company reiterated its recent financial forecast and said it needs to step up execution to improve performance.

Shares of Tiffany, which underperformed the overall market, closed at $ 80.47 on Friday, little change since Mr. Cumenal took the helm.

The luxury brand has seen lower same-store sales for several quarters, penalized by lower spending by foreign tourists, especially Chinese, as the stronger dollar made these shopping trips more expensive.

Last month, the company reported a 4% drop in comparable store sales in North America for the holidays, which it blamed on lower foot traffic to its flagship Fifth Avenue store. The company highlighted the disruption to traffic and security around its neighbor, Trump Tower, where the new president is meeting with cabinet members, CEOs and world leaders.

Mr Cumenal said he did not expect a significant improvement in the macroeconomic challenges the company faced in 2016, when profits and net sales are expected to decline compared to fiscal 2015. The figure d The company’s business has remained stable at around $ 4 billion since 2014.

Tiffany is the latest luxury company to undergo an executive reshuffle, highlighting the pressure on established brands to reinvent themselves for a rapidly changing market, where social media allows newbies to quickly gain a foothold and consumers are no longer loyal.

Last week Ralph Lauren Corp.

said its chief executive, Stefan Larsson, will be leaving the company in May after less than two years on the job due to creative differences with the company founder.

Mr. Cumenal joined Tiffany in 2011 to oversee sales and distribution, and was appointed chairman and joined the board in 2013. The Frenchman was hired at LVMH.,

where he was CEO of Moet & Chandon SA.

Mr. Kowalski, who joined the company in 1983, was CEO of Tiffany from 1999 until he relinquished the lead to Mr. Cumenal in April 2015. He has been its chairman since.

CEO’s departure comes weeks after the company announced it was hiring Coach’s former creative director Inc.,

Reed Krakoff, as lead designer for Tiffany jewelry and accessories. Mr. Krakoff had collaborated on a new line of Tiffany accessories that will be introduced later this year.

Randal Konik, analyst at Jefferies, applauded the hiring of Mr. Krakoff. “Reed will drive change in this business and the result will be more new products more often,” Mr. Konik wrote in a recent note to customers.

Francesca Amfitheatrof, who was Design Director for 3.5 years, oversaw the design of memorable pieces, including a turquoise bead necklace actress Cate Blanchett wore to the 2015 Oscars, as well as the much-loved Tiffany T and Return collections. to Tiffany. But Tiffany has failed to generate the kind of buzz needed to attract young, fashionable shoppers.

Perhaps hoping to change that, the company planned to air its first Super Bowl commercial on Sunday, featuring Lady Gaga.

Write to Suzanne Kapner at Suzanne.Kapner@wsj.com

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