Shares in Danish jewelry giant Pandora took a sharp tumble on August 15, 2025, plummeting 12.6% after the company revealed weakening sales across its core European markets. The steep drop extended a months-long slide, with Pandora's stock now down 36% from its record high back in January, according to Reuters. The news sent ripples through the luxury goods sector, highlighting the mounting pressures of economic uncertainty, rising costs, and global trade tensions.
Pandora, best known for its charm bracelets and affordable luxury pieces, reported second-quarter sales of 7.08 billion Danish crowns (about $1.11 billion). That figure, while still robust, fell just short of the 7.17 billion crowns analysts had anticipated. Comparable sales growth also slowed to 3% in the second quarter, down from 6% in the previous quarter and below the 4% expected by market watchers. July brought little relief, with comparable sales inching up just 2%.
"We expected weak comparable sales in the second quarter and in July to further add question marks regarding the sustainability of Pandora’s growth in the short term, and to weigh on the stock," analysts at J.P. Morgan wrote in a note, as reported by Reuters.
The slowdown was especially pronounced in Europe, where Pandora has long enjoyed a loyal customer base. Comparable sales plummeted 9% in the UK, and fell 7% in both France and Italy, with Germany not far behind at a 6% decline. The company cited economic uncertainty and increased competition as key drivers behind the European slump. In contrast, the United States emerged as a bright spot, with stronger demand helping to cushion the blow from Europe’s downturn.
Despite these headwinds, Pandora maintained its full-year guidance, projecting organic sales growth of 7–8% and an operating profit margin of around 24%. The company’s operating profit for the second quarter landed at 1.29 billion Danish crowns, precisely matching analyst forecasts, while organic revenue grew 8%—again, in line with expectations. "We expect to be able to offset a material part of the effect of higher commodity prices, tariffs and foreign exchange rates through a combination of pricing, cost efficiencies, and operating leverage," Pandora said in a statement.
Yet, the challenges facing Pandora extend well beyond Europe. The company manufactures all its jewelry at two factories in Thailand, making it particularly vulnerable to global trade policies and tariffs. In a year marked by shifting trade winds, Pandora found itself at the center of President Donald Trump’s broader overhaul of U.S. trade relations. Earlier in 2025, the U.S. announced a steep 36% tariff on goods imported from Thailand. However, following negotiations between the two countries in August, the rate was slashed to 19%—a move that offered some relief, but not enough to erase the pain entirely.
Pandora estimates that the current level of tariffs will cost the company 200 million Danish crowns ($31.3 million) in 2025 and a staggering 450 million crowns in 2026. In response, the company has been forced to adjust its pricing strategy. Prices were raised by 4% in April, followed by another low-single-digit increase in August, all in an effort to offset spiraling commodity costs and the impact of tariffs. Silver, a primary material in Pandora’s jewelry, is now trading near its highest level in 15 years—a fact that has only intensified the pressure on margins.
CEO Alexander Lacik did not mince words about the situation facing U.S. shoppers. “Everybody in the affordable jewelry category in the US, pretty much without exception, input from somewhere in Asia where there are varying degrees of tariffs,” Lacik told Bloomberg on August 15. He warned that, ultimately, “the US consumer will have to foot the bill.” The timing and extent of future price hikes remain uncertain, but Pandora is weighing additional increases in both the U.S. and other markets.
The company’s predicament is emblematic of a broader challenge confronting the affordable jewelry sector. As Lacik pointed out, virtually all major players in the U.S. affordable jewelry market source their products from Asia and are subject to similar tariff regimes. This means that higher import costs are likely to be passed on to consumers, either through higher prices or reduced product offerings.
In addition to price increases, Pandora is looking to tighten its belt through cost-cutting measures and operational efficiencies. The company said it expects to offset “a material part” of the impact from tariffs, commodity prices, and currency fluctuations through these strategies. Still, investors remain wary. As AINVEST noted, the sharp drop in European sales and the resulting stock price decline underscore the risks of relying heavily on a single region for growth. Diversification—both geographically and in terms of product offerings—may be essential for Pandora’s long-term stability.
The company’s management faces a delicate balancing act. On one hand, they must navigate a challenging European market and the threat of further economic slowdowns. On the other, they must contend with the unpredictable terrain of global trade, where tariff agreements can shift overnight. The recent reduction in U.S. tariffs on Thai goods offers some breathing room, but with silver prices hovering at multi-year highs and raw material costs climbing, there’s little margin for error.
For now, Pandora’s executives are betting that a combination of price hikes, cost controls, and operational agility will keep the company on track to meet its ambitious targets. But as the company’s recent performance has shown, even the strongest brands are not immune to the turbulence of today’s global economy. Investors and consumers alike will be watching closely in the coming quarters to see whether Pandora’s strategies can deliver the stability and growth they’re hoping for—or whether more tough decisions lie ahead.
As the jewelry world waits for the next move, one thing’s clear: the sparkle of Pandora’s charms may be dimmed for now, but the company’s resilience is about to be tested like never before.
