Luxury jeweler Tiffany & Co said profit would decline in for the full year and reported lower-than-expected sales for the second quarter as a strong dollar discouraged tourist spending in the United States and reduced the value of overseas sales.
The company's shares fell 7% in premarket trading on Thursday.
"The adverse effects from the strong dollar have been even more significant than initially expected, Chief Executive Frederic Cumenal said in a statement.
Sales at New York-based Tiffany, which gets roughly half of its sales from outside the Americas, have been reduced by 2-7 percent in the past three quarters due to currency factors.
The average value of the dollar <.DXY> in the May-July quarter has risen about 19 percent from a year earlier.
Tiffany's total revenue fell 0.2 percent to $990.5 million in the quarter ended July 31, missing the average analyst estimate of $1 billion, according to Thomson Reuters I/B/E/S.
Excluding currency effects, revenue rose 7 percent.
Net income fell 15.4 percent to $104.9 million, or 81 cents per share. Excluding items, Tiffany earned 86 cents per share, while analysts had expected 91 cents.
The company said it expects net earnings to decline 2 percent to 5 percent for the full year.
Tiffany's shares were trading at $79 before the bell on Thursday. Up to Wednesday's close of $85.08, the stock had fallen 20.4 percent this year.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D'Souza)