Pandora posted modest growth in the second quarter of 2026, with like-for-like sales rising 1%, while demand for its lab-grown diamond jewellery weakened noticeably. The Danish jewellery group reported revenue of DKK 7.22 billion (about US$1.10 billion), a 2% increase at reported exchange rates and 3% organic growth compared with the same period last year.
Management attributed the improvement to a combination of new product launches, continued expansion of the retail footprint and strong momentum in Latin America and Asia-Pacific. Profitability benefited in the quarter from a one-off refund related to US tariffs, which supported operating performance despite ongoing cost pressures.
Lab-Grown Diamond Demand Under Pressure
The most significant weakness in the quarter came from Pandora’s lab-grown diamond range. Sales in this category fell by 20%, with the company reporting particularly subdued consumer appetite for larger, higher-priced pieces in the $1,000–$1,500 range. This decline highlights the difficulty of translating interest in lab-grown stones into purchases at premium price points.
In response to this shift in consumer preferences, Pandora plans to reposition its lab-grown diamond assortment toward a more accessible price bracket of roughly $250 to $500. The company emphasised that the category remains relatively small, contributing no more than 1% of group earnings, yet it represents an important strategic experiment in offering alternative diamond products since Pandora has used only lab-grown diamonds in its diamond jewellery range beginning in 2021.
The current pullback in demand for high-ticket lab-grown pieces is an important signal for the broader industry and for Pandora’s product strategy. It suggests that while lab-grown diamonds attract attention, consumers in many markets still prefer lower-priced pieces or remain cautious about trading up to more expensive new categories. Pandora’s decision to shift the assortment toward affordability aims to broaden appeal and drive trial among price-conscious shoppers.
Profitability Improves
Pandora reported operating profit of DKK 1.46 billion (approximately $225 million) in the quarter, up from DKK 1.29 billion a year earlier. Net profit rose to DKK 875 million (about $135 million), compared with DKK 803 million in the second quarter of the previous year. These gains were supported by the tariff refund and ongoing retail and product initiatives.
On an underlying basis, excluding the one-time US tariff refund, the EBIT margin remained broadly stable. The company continues to navigate cost headwinds from commodity prices, currency fluctuations and tariff exposure. Despite these pressures, Pandora’s management said the quarter showed early signs that efforts to revive growth are starting to take effect.
“We are making progress in re-energizing Pandora’s growth engine,” President and CEO Berta de Pablos-Barbier commented, referencing the 1% like-for-like growth and initial positive impacts from recent strategic initiatives. The leadership highlighted product assortment refreshes and selective retail expansion as key contributors to the quarter’s performance.
2026 Outlook Raised
Reflecting improving momentum, Pandora raised its organic growth guidance for 2026 to a range of 0% to 3%, up from the prior outlook of negative 1% to 2%. The revised forecast signals cautious optimism driven by better-than-expected performance in core markets and confidence that ongoing initiatives will support recovery.
At the same time, the sharp decline in lab-grown diamond sales underscores a strategic challenge: how to convert consumer interest in sustainable or lab-created stones into demand for higher-value jewellery. For Pandora, the next phase will involve balancing its broader jewellery growth strategy with a repositioned, more affordable lab-grown diamond offering aimed at attracting value-driven customers.
Moving forward, Pandora’s focus appears to be on refining product price architecture, continuing selective store openings, and leveraging market-specific opportunities in Latin America and Asia-Pacific to drive volume. The company’s performance in the quarter suggests measured progress rather than a full recovery, with management signalling that sustained momentum will depend on successful execution of these initiatives and the market’s response to the adjusted lab-grown diamond strategy.