Sales rise, but Q1 profits dive for Blue Nile
Web sales grew modestly for online jeweler Blue Nile Inc. in the first quarter, but profits took a deep dive.
For the quarter ended April 1, Blue Nile, No. 71 in the 2012 Top 500 Guide, reported:
- Sales increased about 3.7% to $83.1 million from $80.1 million in the first quarter of 2011.
- International sales increased year over year 9.3% to $14.1 million from $12.9 million.
- U.S. sales of engagement rings, Blue Nile's signature product, increased 3.1% to $46.4 million from $45 million.
- U.S. sales of all other types of jewelry grew year over year 1.3% to $22.6 million from $22.3 million.
- Net income decreased 93.6% to $154,000 from $2.4 million in the first quarter of 2011. Blue Nile says increased customer acquisition costs in the U.S. and elsewhere were a key reason profitability declined.
"In January, we launched a plan to accelerate growth in the business through increased investments in the U.S. and international markets," says CEO Harvey Kanter. "As expected, our financial results reflect the costs of these investments in reduced profitability versus a year ago."
In the second quarter Blue Nile expects sales to range from $87 million to $91 million and from $384 million to $417 million for the full year.