Signet CEO Virginia Drosos joins Yahoo Finance Live to discuss company earnings, the expectations for wedding season, the demand for jewelry, and the outlook for the diamond industry amid the U.S. ban on Russian diamonds.

Video Transcript

BRIAN SOZZI: This is shaping up to be a summer of love as people hit up the dating scene after hesitating a bit during the pandemic. And to that end, we could also witness an all-out wedding boom. One company that should benefit from that boom is jeweler Signet, which owns top brands such as Jared's and Kay. Joining us now is Signet CEO Gina Drosos. Gina, good to see you here this morning. There's going to likely be a lot of weddings this spring and summer. What does that mean for your business?

GINA DROSOS: Well, it's an exciting time, Brian. This is going to be a year that has more weddings than we've seen in the last 40. A lot of people waited to get married, or at least have their wedding ceremony, until they can invite their friends and family. And what we know is that even though people buy engagement rings reasonably far in advance of planning their wedding, they buy their wedding bands only about two months before. And there's a tremendous opportunity also for us to help with earrings, beautiful necklaces, grooms' gifts, groomsmen's gifts, bridesmaids, mother of the bride, all of that.

We have one very interesting program that's different actually going this year, is that we're doing rental bridal jewelry, so that people who might be interested in having that beautiful necklace or earrings for the wedding can rent that from us. And then if they fall in love with it and get used to seeing themselves, well, that could be their first anniversary gift.

JULIE HYMAN: That is a really interesting idea. I like that, Gina. I wanted to ask you about the balance of that versus the balance of your non-wedding wedding business because there has also been some talk among economists and analysts who follow the company that they keep expecting to see this transition away from people buying stuff, of course, to spending more on experiences on travel, on going out, et cetera. Are you seeing that in the business yet, that the non-wedding stuff is declining at all or waning in demand?

GINA DROSOS: We certainly didn't see it last year, Julie. The entire category was up about 20%. Signet grew about 50%, So we just reported our earnings last week with revenue up 50% versus the prior year. We gained about, we think, 270 basis points of market share to now have a 9.3% market share in the US. But we do anticipate that category growth will slow a bit this year because people will return to buying trips, to having experiences.

The wonderful thing, though, is that people during COVID have spent more time with fewer people. And so we've seen that many people are giving nicer gifts to those who are close to them, and jewelry is a fantastic gift to take on a trip or present while you're on a trip. We've seen more husbands coming into Mother's Day and Valentine's Day as purchasers of jewelry. And of course, those can lead into gifts over the summer when you go on that great trip.

So we think that the category growth will slow a bit, but the capabilities we've put in place by culling our brick and mortar and optimizing that footprint, along with being now the leading e-commerce retailer of jewelry in the country as well, we think those things will help us to continue to grow market share.

BRIAN SOZZI: I just want to stay in there. I'm going to go a hard right turn here, Gina. What are you doing to educate the male shopper? I feel as though so many folks go into these stores, guys, and they absolutely have no clue what in the world they're buying.

GINA DROSOS: It can be even a stressful time for shoppers. It's sometimes the most expensive purchase that a couple has ever made together, so we spend a lot of time on education. Many of the jewelry consultants that we have in our stores are certified gemologists. So they go through significant training to be able to help on that journey. We now also have 700 virtual jewelry consultants that you can engage with online. We also have YouTube videos. You can go to our websites and get lots of information.

You know, it goes even beyond the four Cs, but just how Signet treats responsible sourcing, how we think about different colored gemstones, for example, as options for people who want something a bit more distinctive. We're very conscious of wanting to make this feel like an exciting moment.

JULIE HYMAN: And not an intimidating one for sure. Forgive me, Gina. I'm going to take another hard right turn in yet another direction, and this has to do with Russia and the invasion of Ukraine. You all announced that you were not going to be sourcing diamonds from Russia any longer. How-- What percentage of your diamonds were coming from Russia? And sort of, how difficult is it when you make a supply chain switch like this to make it happen?

GINA DROSOS: Well, we announced several things last week. Thankfully, we don't have people who are on the ground in Russia. And so we did announce that we're no longer buying directly any diamonds from Russia. We've also asked all of our merchandise vendors not to put Russian diamonds that have been sourced since this conflict began into our product.

This is part of a responsible sourcing promise that we have with our customers, that we've had now for more than a decade, that every metal, every stone they buy in one of our stores was ethically and responsibly sourced with full regard for human rights. So this is something very important to our company.

And we stay agile. We've really broadened our supply base over time. And we have many strategic vendors that we work with. We worked with them before we made the announcement so that we were sure that we could pivot our supply chain in the way that we felt we needed to. And they've been very responsive and great partners with us.

BRIAN SOZZI: As part of this conflict, Gina, we've seen consumer confidence in the US really take a plunge. Are you seeing a more nervous shopper enter your stores? And how are you trying to accommodate them?

GINA DROSOS: I think that's certainly a possibility. One thing that we have seen, though, previously in inflationary times, is that the jewelry category remains strong. Because customers inherently appreciate the value of what they're buying, and they know that diamond rings and beautiful necklaces actually increase in value over time. So among the luxury categories, we would expect that jewelry and the opportunity to celebrate life and express love with those who are closest to you would continue, but not at the same pace that it did last year.

BRIAN SOZZI: Well, I, for one, appreciate that additional education on jewelry. I will have to go search on the site for that--

JULIE HYMAN: Why, Brian? Why?

BRIAN SOZZI: We're moving right along. Leave it there. Signet CEO Gina Drosos--

GINA DROSOS: Men's jewelry is trending, too, Brian.

BRIAN SOZZI: All right, fair enough--

GINA DROSOS: That's been one of the most interesting advent of COVID, is men's jewelry is very strong right now.

BRIAN SOZZI: Fair enough. All right, well, we look forward to staying in touch with you. We'll talk to you soon.