Pandora A/S / ADR (PNDRY) Q2 2026 Earnings Call Transcript

Good morning, everyone, and welcome to the conference call for Pandora's Q2 2026 results. I'm Bilal Ziz from the Investor Relations team, and I'm joined here by our CEO, Berta de Pablo's Barbier, CFO, Anders Boyer, and the rest of the IR team. As usual, there will be a Q&A session at the end of the call. If you could limit yourself to two questions, that would be great. Please pay notice to disclaimer on slide two and then turn to slide three, and I will hand over to Berta.

Thank you, Bilal, and welcome, everyone. I would like to start with a small reminder and providing some context that 2026 is a year of deliberate change for Pandora. We are rolling our new growth model with greater focus on distinctive design, cultural relevance and a stronger local execution. Now in addition we are also expanding our retail experience with some pilots intending to inspire discovery and giving the consumers more reasons to buy. We will be a scaling across markets as we see proof points that is working and importantly we are also improving the quality of growth substantially reducing promotions and heavy discounting and you can see this implemented particularly in our core markets. Now all these actions of course are intending to strengthen brand desirability and relevance and to build a healthier platform for sustainable growth. I will expand a little bit later and you'll be able to see some examples. But with all that, let me turn to quarter two. Quarter two played out broadly as we expected. We delivered 1% life for life growth and 3% organic growth. Growth in this quarter reflects a deliberate reduction in promotional activity, particularly in court markets. So of course, it has moderated growth in the near term, but is the right choice for both the health of the brand and the quality of our growth. Profitability remains strong, EBIT margin benefit from the refund of previously paid U.S. tariff, but even if we actually exclude this effect, the business has continued to demonstrate a disciplined cost control and very resilient profitability. And finally, our returns remain high at close to 40% despite the external environment. Let's now move to the Next slide, please. I would like to turn to guidance now. We have adjusted both our top line and EBIT margin guidance for the year. Now for the top line, we are now targeting an organic growth of 0 to plus 3%. And the main change on this guidance is actually our life for life growth, which we are now increasing to minus 2 to plus 1. And this compares to the previous minus 3 to 0 on Life for Life. Now, why this upgrade? Well, this upgrade reflects our performance in the first half of the year, but at the same time, we have to be careful because we continue to operate in a volatile macroeconomic and geopolitical environment, and the implications for consumer still remain uncertain. Now, on EBIT margin, the upgrade of our guidance from 22 to 23 compared to the 21-22 previously. Andres will be taking you through the guidance in a little bit more detail shortly. Now let me talk a little bit about current trading. The life-or-life growth in the quarter so far has been around mid-single digital levels. Of course, there has benefit from the timing of our end-of-season sale, which was more weighted towards July this year versus June last year. But I I want to be very clear, while we start the quarter and the quarter at the beginning is encouraging, July is not representative of the underlying run rate of the business, so it should not be extrapolated forward. It is important to keep this thing in perspective. Now let's get into more detail on the quarter two performance drivers, if you can pass to the next slide please. Now, quarter two, we deliver a 1% life-for-life growth, and you can see the split between the core and the few with more on this slide. Now the way to read this result is, where we have distinctive product newness with high impact activation, we are driving growth. In other areas, there is more work to do, and actions to put this in place are starting with high focus, of course, on our core business. Core deliver minus 1% life-for-life growth in line with Q1. The growth in the core continued to be supported by the strong performance of the collection launched last year, Talisman. Now in moments, our playful aesthetic, the opportunity is still there to bring a stronger, more distinctive newness. And as I said before, this is where all our focus is now. Now in Field with More, where we have higher mix of distinctive design, we deliver 3% life-for-life growth. And that performance was very supported by Timeless, which our new Garden of Dreams collection, and Pandora Essence. Let's go into the next slide to talk about markets. Our original performance in Quarter 2 remained mixed. Let me start with the EMEA region, which is our largest region. There we deliver a life-or-life growth of minus 2%. Now Spain, Poland, Portugal continue to perform very well, and that was upset by weak performance in some of our mature markets like Italy and the UK. Now growth in these markets, Italy and UK, reflects, as I mentioned, a significant reduction in promotional days versus last year. In these markets, in addition to implementing the new growth model, we are also piloting an evolved retail experience with a clear objective of strengthen desirability, inspire discovery, and give consumers more reasons to buy Pandora. We are bringing collections into curated looks, elevating the product presentation, and strengthening visual storytelling. Early signs are encouraging and we will continue to refine and scale what works. Now in the US, our larger market, the life for life growth was flat in the quarter. Now performance continued to be impacted by softer consumer sentiment and lower store traffic. But against this backdrop, the brand remains healthy and strong. and we continue to focus on what we can control, strengthening demand creation through most impactful brand activation and locally relevant execution. So overall for the region of North America there was a stable growth around minus 1%. In Latin America our life for life growth accelerated to 18%. The price repositioning that we introduced earlier this year continues to deliver strong results. This is supported by a strong local activation and influence engagement which I'll touch a little bit more later as well. And finally in Asia we deliver in a strong growth of 10%. Our rollout in Japan continues to progress very well and we still remain in the early stage of building that brand awareness that reached through continued increased marketing investment. Now, let me show some examples of what do we mean by our new growth model is coming to life to drive demand. We can go to the next slide. I did mention last quarter that we have started to rebalance our marketing investment, and the introduction of the Garden of Dreams campaign is a good example of this shift in action. The campaign basically brought together some of our most distinctive designs of the season with a stronger, more focused amplification across touch points, events, influencer. You can see some examples in the picture. And this reinforces a point that I made last quarter. When we bring a strong product design and marketing that is relevant, they work hand-in-hand and deliver growth. So this absolutely translated into growth across all markets. And you can see that reflected in the strong performance of the timeless collection and therefore our fuel with more segment in this quarter. Let's go to another example on the next slide. You can see here as well how we are bringing our new growth model to life. Following the success of Bridgerton in quarter one, in July we launched Pandora Wonders, a multi-year creative platform that is designed to build desirability and drive demand through design, craftsmanship and cultural relevance. Now our first action was co-created with Harry Lambert and was launched during Paris Haute Couture Week. And this is exactly what we want to do more, is really create cultural moments for Pandora, is bringing Pandora into the cultural conversation through distinctive design and high impact activation. Now this campaign was launched in key markets, is early, but response has been very strong, particularly on our earned media and PR coverage. So it is encouraging and that we are seeing as well the first sign of early engagement from new customers coming to the brand and being attracted by the Pandora brand. Now what matters most is the long-term opportunity of this platform as this year we will bring a new creative voice to play and reinterpret our materials and our craftsmanship through limited edition capsules. Of course you will hear more of how this campaign performed on the quarter three which will have the entire KPIs. Let's go now into the next slide please. Now of course we do continue to invest on our store network both expanding our footprint but most importantly or equally important and elevating the experience of our existing stores. So we do continue to roll out our digital screens, our store facades, which is allowing us to bring the collections and the brand storytelling to life with much greater impact. Now during the quarter, we open new flagship stores in Barcelona and Milan. And this store is a good opportunity to bring together the full breadth and inspiration of Pandora and set a new benchmark of how consumers experience the brand. I really encourage you if you find yourself in either city to visit some of the stores as you will see and understand better what the great expression of Pandora can be on the brand experience. Now let's go to the next slide. I'm just going to bring everything I have just said together by reminding the direction that we set out in February. you will recognize this slide. You have seen some concrete examples of how this is now coming to life. More design-led newness, more effective marketing, and stronger locally relevant execution. As you see, Garden of Dreams show that and brought that into practice and also prove that we have opportunity to get Pandora into new categories, necklace, rings, etc., where you know we have still opportunity to grow. So these actions are in motion. We are seeing encouraging proof points, but they are not yet fully reflected in the performance of the business today. So as I said, 2026 is a deliberate year of change. We're bringing more discipline and scaling what works. You will hear more on the quarter three, where we are bringing together a strategic update. But now we can go into the next slide. Now, of course, growth is one part of the equation. but of course, as you remember, the biggest second priority for Pandora and for myself is to protect profitability. Equilever is our response to our rising silver prices. Now, in February, we introduced the platinum-plated jewelry on our proprietary Evershine alloy, which is going to transition a part of our existing white metal portfolio over time into platinum-plated. Now, this is supporting profitability, but equally and most importantly, it is a compelling consumer proposition. Why? It's bringing platinum, which is a precious metal, into a more accessible format with a strong durability for everyday wear. Now, I think it's important to remind that Pandora has already evolved beyond a single material proposition. That what matters also is that consumers choose Pandora for our design, our craftsmanship, our quality, and our meaning across different materials. We don't need to speculate. A proof of that is the success of our gold-plated jewelry, which continues to grow strongly. Now, of course, as you remember, we have been working on this transition for more than a year. this transition has been supported by extensive consumer testing and validation. So all above give us confidence in the acceptance and adoption of platinum plating as a white metal proposition. Now during the quarter as well we have started our pilot in the Netherlands with five key carriers, four bracelets and one necklace. Now this is early but the initial response I have to say is been encouraging on the adoption and we are also using the pilot to learn and refine our execution before the global rollout next year. We will extend as well this year with more selected design across more markets and this will be a good source of learning for us. Now important to remember this is an evolution of our product platform that is bringing greater choice to consumer while strengthening the long-term resilience of our business. We expect, and it's very obvious, that we'll be the first jewellery brand to bring platinum-plated jewellery to scale. We will be providing more detail on the rollout and as well on the latest financials and EBIT market margin implications with our quarter three strategic update. But on that note, I'd like to now hand over to Anders to take you through the rest of the presentation.

Thank you, Bertram. and good morning everyone and please turn to slide 14. Bert has already commented on the top line so I'll focus on a couple of the other financial metrics and the key message for the quarter is that margins remain solid that's both on the gross margin and EBIT margin level and that we continue to manage all of the external headwinds quite effectively and as I'm sure you've We did get a one-off benefit this quarter from the partial refund of our U.S. tariff claim, and we broke it out in the impact out on the margin for you, so you can track the underlying performance. This one-off meant that our gross margin was up 120 basis points in the quarter, but even when you exclude the one-off, you'll see that our gross margin was still above 78%, and thereby only down around 100 basis points compared to last year, despite that we faced just under 300 basis points of external headwinds. So quite a strong margin and highlighting the good cost efficiencies that is still being deliberate, but also a deliberate reduction in promotions, as Berta said. Next slide, please. And here we break down the revenue growth in the quarter, as usual. we've talked about the like-for-like building block already so I'll touch on some of the other elements in the bridge on the network expansion the purple building block at four percent that continues to track well generating healthy top-line growth in white space areas and with no cannibalization and generating very healthy margins you also notice that this quarter specifically we saw two percentage points drag from the bucket that we called sell-in and other. And there's two elements to this. One is just facing between quarters but that we will always see and then secondly some of it is linked to lower selling to certain partners. Next slide please. On the EBIT margin performance was strong. The EBIT margin was up 210 basis points year over year. And as you can see from the bridge here, it was held by the partial refund of our claim on the U.S. tariffs, and that accounted for 250 basis points on EBIT margin level. It is a one-off, of course, and there will be more of that coming in the second half of 2026, and I'll speak about that shortly. If you exclude that one-off impact, you can calculate that the EBIT margin was broadly in line with last year and some of you will probably point out that even that was a bit better than what we have communicated about phasing through the year earlier on and that's fair and the reason is that just like in Q1 we did see some cost-facing benefit of around 200 basis points in the quarter and that phasing includes the level of marketing spend it where we ended up deciding to spend which you can also see in the announcement today that it is a bit below last year but that facing will be reversed in q3 and q4 and then be neutral for the full year and overall yeah you should read from this that we are of course keeping a tight control on our cost in this in this current subdued revenue and macro environment and we will continue to offset a large proportion of the external headwinds that we are facing. And with that, let's move on to the guidance. As Berto already said, we've upgraded both our revenue and EBIT margin guidance. And let me tackle revenue first. We upgraded our organic growth guidance by one percentage point on both low end and high end to now being plus two to minus one and this sorry yeah to sorry to zero to three percent and this upgrade is driven by higher like like expectations for the full year where we now now see like for like growth of between plus one and minus two versus previously between flat and down to minus three and the low end of that range continues to factor in the fact that the consumer environment remains weak and the geopolitical uncertainty remains quite high and we do not know how this will play out for consumers, even on a short time horizon. The high end of plus one basically calls for similar growth in the second half as we saw in the first half. So keeping the run rate of our like-for-like growth to what we've already seen. We do acknowledge that our comp base is getting easier in the second half of the year. and here's a couple of thoughts on how to think about that. First of all, we are planning a promotional detox in the second half of the year to further protect brand equity. And secondly, if you dig into the comp base, you will see that the two-year stack mostly gets easier in the U.S. But the U.S. is at the same time the market with particularly high macro and geopolitical uncertainty, and it's also the market where we see the K-shaped economy impacting our consumer base. And lastly, we do not expect to repeat the growth levels that we've seen in Latin America and Asia Pacific in the first half of the year. Some of this will naturally moderate. And when we say this, and that's not to ignore the impact of the initiatives that we're working on to reignite the growth engine but these will take time to feed through into sustainable improvement in like for like every quarter and as we did say back in in February 2026 is a transition year as you can also see in the bridge we have increased our network guidance to plus 3% organic growth contribution up from 2% initially and this increase is then offset by slightly lower selling to certain partners and we now expect sell in and others to be around minus 1% and then those two components nets out. And then if we could go to the next slide please. On the EBIT margin guidance we've upgraded it to 22 to 23 percent from 21 to 22 percent before so an increase of a hundred basis points in both the low end and high end of the range and this change in the guidance you can see here relating to the purple box that we call tariff refund and and the hundred basis points being the income we expect from the refund of tariffs that we have previously paid we already got an impact as you we just talked about in the second quarter equivalent to just around 50 basis points of full year ebit margin impact and we expect to have another similar 50 basis points positive impact sometime during the second half of the year and again this tariff refund is a one-off benefit for for the years so keep that in mind when you think out to 2027 and all other building blocks are broadly unchanged and on that note I'll hand back over to Berta thank you very much Anders so let me just conclude and I would like just to leave you with a few points yes we are making progress on the priorities we set out in February the actions are now in motion across the

business and we are seeing encouraging proof points. Now there is still more to do to translate this consistently into any stronger like-for-like growth. Now at the same time we are also driving healthier growth through greater promotional discipline and we do continue to demonstrate a strong financial control. Now based on our performance and outlook we are upgrading both our top-line and EBIT margin guidance for the year. We are progressing our transition to platinum plating, which is an important evolution of our product platform that will diversify our metal mix and strengthen the resilience of the business over time. We will be saying much more about it on this next phase for Pandora and all our strategic priorities with our quarter three update. Now, if you will allow me, before we move to Q&A, I would just briefly like to touch on an announcement that we made last Thursday regarding you, Anders. As you know, Anders has been an integral part of Pandora's development. And I am really personally very grateful for everything that he has contributed to Pandora. We do, of course, respect his decision to retire from operating roles. is his choice and we wish him all the very best. Of course at the same time we are very pleased to welcome Paulo Garcia. He will be joining Pandora in October. We will have a leadership transition that will run very smoothly between both of them and of course this does not change our strategy, does not change our priorities or our ambition for Pandora. We do know where we are going. We remain fully focus on our execution to deliver that with discipline and consistency. And with that, please let me thank you for your attention, and I think it's time to open for the Q&A.

We will now start the Q&A session. If you wish to ask a question, please press five star on your telephone keypad. To withdraw your question, you may do so by pressing five star again. We kindly ask that you please limit yourself to two questions and then rejoin the queue for additional questions. Our first question will be from the line of Thomas Schubert from Citi. Please go ahead, John. I will now be unmuted.

Good morning. Thanks for taking my question. Over the years and best wishes for your retirement from executive life, I think you have. My two questions are followed. The first one on the U.S. LFL improvement in a still difficult consumer sentiment environment. What are you seeing across? And Bertha, are you starting to see tangible benefits from the recent product and marketing initiatives that give you a greater confidence about a rebound in this market, maybe in the back half of the year? And secondly, on the tariff topic, you indicated in the release a lower tariff on U.S. imports from Thailand going forward, down from 19%. I mean, how much do you expect that to support your gross margin next year? And could you, the implications for Vietnam as well, is there any change there in that new crafting facilities for the U.S. imports? But also, could you comment whether that facility is also adapting, shifting to the platinum-plated strategy as planned, given it was built for a slightly different purpose, I guess, more for a silver type of business. Thank you.

Thank you, Thomas. So let me start with your question of the U.S. What we are seeing in the U.S. is that the consumer sentiment continues to be low, the macroeconomic continues to be difficult for the increase of discretionary spend. This is something that you see. What we see on the industry, on the total jewelry and accessories industry, the traffic is slightly flattish. We are slightly behind on traffic, but we are seeing a strong increase on our conversion on our average basket for the U.S. business. And this is both on our offline and our online store. So, everything that we see indicates that what we are doing with the distinctive newness and the new marketing model is working in the US. We see that as well reflecting on the performance of the Timeless Collection, which was growing as well in this market. So yes, the proof points are building up and that's why we are confident for the remaining not only of the year, but of the years to come.

Thank you, Thomas. On the other question, thank you for your kind words on the tariffs. When we communicated targets back in February, high-level guidance on EBIT margin for 2027 and midterm, that was based on the assumption of the old tariffs, if I can call it that, around 19 to 20 percent level. So with the new tariffs in place, that gives roughly a 70 to 80 basis point of margin upside on gross margin going forward compared to what we've said previously. So we'll take that. On Vietnam, the tariff level between Vietnam and Thailand are very much aligned. so there's no competitive difference from that point of view from producing in the two countries. And Vietnam is definitely part of our overall plan on how we build up much more plating capacity going forward. There will be some plants that have a higher share of of plating than others like today where the one of the factories in thailand the double b factories is only doing doing plating so there will be some differences between them but there's no disadvantage on on vietnam from the from the tariffs thanks thomas our next question will be from the line of last top from dnb carnegie please go ahead I will now be unmuted.

Yes, congrats, first of all, on a great quarter. And for me also, thanks for everything. You still look way too young to retire, but that's how it is. I'll also limit myself to two questions, please. So one goes for the moving parts in 2027, where you specifically call out that the price of silver, everything else equal, helps you with 200 bps on the gross margin compared to the assumptions behind the 12% minimum margin, 14% underlying. I wonder if you can give a similar specification of the tailwind relating to gold, relating to FX, and relating to platinum, so we sort of know what moving parts you are working with. And then a second question, maybe for you, Bert, I just wonder if you can put some more color on what you are seeing from the platinum plating in Holland.

And I know it's early days and not that many HKUs, but have you learned anything that surprised you pleasantly or the opposite? it and what are sort of the key findings and are there any sort of hard numbers you can share so far thanks thank you for uh those questions uh last and i i'll put the you look younger into my scrapbook so a particular thank you for that uh yeah a fair question on on the on the margins starting with 2027 silver, just around 200 basis points, as we wrote in the announcement. And the logic in that is that the original assumption was a silver price of $82. Now we've hedged around $65. So that's a $17, obviously, upside. and with a sensitivity next year in the 12, 13, 14% range basis points per 1 EURUSD you get to around 200 basis points of upside on that. Then on gold and platinum it's much smaller numbers but still an upside so in round numbers for both gold and platinum 25 to 30 basis points of upside at the current spot prices each next year, and then as we just spoke about just before, then we have 70 to 80 basis points of tariff upside as well if they remain at the current levels that was announced by the U.S. government over the summer. Foreign exchanges is a small change. On a pure technical co-upgrade that will give just a little bit about 300 basis points of margin upside next year on a, so on all other things basis. But of course, we think that it makes more sense to give you an update, a broader update on the margin guidance for 27 and midterm as part of the strategic update that we will be coming in in november because of course there's other moving parts than commodities and silver so we want to bake it into the the broader uh uh update uh which feels like a natural time to do it come come november yeah that makes sense but in connection with that Because in your part of the presentation, you also mentioned underlying margin drivers contributing 250 bps.

So since we're on that topic, maybe you can specify what those are. I mean, there's some channel mix, there's probably some price, there's some efficiency gains. There's an effect from fuel with more outperforming core. Can you quantify that bridge a little bit more?

You're thinking about specifically in the second quarter margin?

Yeah, because I assume some of these drivers are also drivers who are relevant when we look into 2027.

Yeah, fair comment. By far the majority of what sits in that net operating leverage in the second quarter that upside there that's cost facing to the tune of 200 basis points specifically in Q2 and again if we drill one more step down into that cost facing more than half of it is marketing where we have been spending less marketing in the first half compared to last year and in the second half we will be spending more than than what we did than what we did last year so on that on that note that there's no some other structural changes

for the 27 Martin apart from commodities and and tariffs your second question will actually become the third question we are on the platinum plated So you said it, Lars, I think it's still very early days, but what was a pleasant surprise was to see that it was confirming the hypothesis. And it was according to the expectations of all the data that we had previously collected with our more than 30,000 consumers. So that is actually confirming what we initially expected. Just to give you a little bit more flavor, as a reminder, we are doing a test on both our physical stores and on our online stores. On our physical stores, the platinum-plated products are priced at the same price of silver. So we are learning about what is the demand when we price at the same. And on the online, we're actually getting a different price testing as well. So more to come on our quarter three announcement on all the learnings on that part. But so far, confident.

Thank you very much. I'll jump back into the queue.

Thanks, Lars. Our next question will be from the line of Frederik Norvest from Morgan Stanley. Please go ahead, John. I will now be unnuted.

Hi, good morning. Thank you very much for taking my questions. I have two, if that's okay. Firstly, on the 2026 like-for-like guidance, so you're now guiding from minus 2 to plus 1 for the year, which given the flat like-for-like in H1 implies roughly minus 4 to plus 1 or 2 in H2. But at the same time, Q3 trading is already running at mid-single digits, albeit with some benefit from phasing of commercial activities. So perhaps could you help us understand the degree of conservatism based in the guidance and specifically what would drive the slowdown implied for the remainder of the second half and in Q4 in particular? And then my second question is on Europe. Berta, you mentioned earlier today that the recent heat waves have weighed on store traffic in Europe with some consumers staying at home and shopping online instead. So could you help us understand how material that impact has been on recent like-for-like trends? And are you seeing online growth broadly of setting the weaker store traffic? Or has there been a net negative impact on like-for-like? And as temperatures have normalized now, I think, have you seen any corresponding improvements in store traffic?

Hi, Cedric. I'll take the first one on the guidance. You're broadly in the right ballpark in terms of the implied light for light growth for the rest of the year with the high end implying around one-ish. I'll just kind of repeat what Anders said. there is a kind of deliberate detox on the promotion planned, even for the remainder part of the year. That will act as a small part of a drag against that just to protect the brand equity going forward. And I also appreciate your comment on kind of current trading. But again, we said, please don't take that as a run rate right now. There's some phasing element in that as well. And then last but not least, we're still relatively cautious on the broader macro environment in the US as well. We'll see how that plays out. So many moving pieces. I appreciate the maths is what it is as well. But there's many, many factors at play here.

Yes. And then on the traffic listen, is it substantially impacting the quarter two results? The answer is no. And did we see some changes on those weeks? Yes. I mean, what we are seeing is that if I take the full quarter to traffic in seven out of our ten markets, the traffic for the industry, so this is either the jewelry and accessories or the retail, has been negative on the quarter two. And we are pretty much either online or slightly negative, depending on which are the countries. As far as our e-commerce performance, it's pretty much online for the total quarter. with our offline, with, again, maybe on those two weeks. Yes, we saw a slightly peak, but we are just talking weeks out of three months. So not a substantial impact.

Thanks, Frank. Our next question will be from the line of Christian Godixen from SEB. Please go ahead, Yael, I will now be unmuted.

Thank you. I usually don't do these congratulations, but Anders, I also want to congratulate on a strong heritage and performance based on your well-deserved choice to retire. So to the two questions I'll limit myself to this time. First of all, maybe could you comment a bit on whether there's a structurally higher run rate and hence impact from new stores as you allude to your upgrade or guidance from network expansion without upgrading the number of new stores? So that would be the first question. And then the second question, I guess that's for you, Berta. Could you maybe comment a bit more on when should we look in terms of timing of the inflection points in terms of life-to-life improvement in the mature markets such as Italy and the UK and France, based on all the initiatives you are doing? Thank you.

Thank you for that, Christian, and likewise a pleasure to have been working with you. You're right that we are upgrading the network guidance, but keeping the same number of stores that we opened this year. But when we set out the guidance at the start of the year, we took probably a somewhat deliberate, cautious stance on this, given that it's a transition year, but also the uncertain consumer environment and the network assumptions and how much growth each store would be generating was part of that. And then since that, so far, the seven, eight months that has passed so far, the rollout of new store has tracked at the upper end of what we had planned for internally. And that has, so the new stores are generating a bit more revenue than we had in the original two percent assumption. So we're basically simply bringing the assumptions now in line with the actual delivery for the first seven months of the year.

Okay, so maybe just, and just before Berta, can I maybe just follow up? So basically to understand, I guess, many of the stores are opening in the new markets. So is it fair to assume that you're confident or optimistic or a bit more optimistic on the growth contribution from network expansion in these new markets? Is that the way to look at it as well?

I think in general, the way to think about it is that when we set out the original guidance, we had an assumption of both, of course. when do the stores open and then what kind of revenue do they generate from day one and on both a little bit earlier in terms of opening and then and they generate a bit more store than what i was also a bit more revenue than what we had dared hope for in this macroeconomic environment and that's somewhat i would say in the decimals when we made the original guidance we were it was two point something that rounded down to two and now with the updated assumptions it is two point something that rounds just to a three so that's also uh of course one of the consequences of your report in without a decimal and you you can't see that yeah and as for for your other question um basically when you look at all the performance of our core market is directly linked to the performance of our core collections.

So what we need to do is to start improving the performance of the existing core collections and as we said already this is come from coming new distinctive newness being re-injected to refresh the core collections. What we are starting to see we are now focusing on that and you will start seeing improvement over time. When we look at the time it takes to develop collection the biggest impact will start from 2027 but of course that doesn't mean that we are doing nothing this year we are just trying to maximize the impact of what we had on our plan uh one example of that i shared with you was wonders where we create a lot of noise and achieve a early media value uh record for pandora ten times more than previous activation so we continue to focus on on driving that perception as we bring the new collections and very clear but you said i think you said earlier on a conference call that you knew we could see when i think was a connection when philippa was was hired that we could see some newness in q4 is that still is that still in place for timing wise that you will see some of the new the newness in q4 she's working uh she's working hard on that so that is still remains some some of the plan and then let's see how much volume we can bring uh one is to bring the design and the other is to make sure that we can scale that at a substantial level thanks i'll jump back.

Thanks, Christian. Our next question will be from the line of Darian from Bank of America. Please go ahead, your line will not be unneeded.

Hi, this is Daria from Bank of America. Thank you for taking my questions. And I also wanted to say thank you to Anders for all years of collaboration. And I have two questions. Could you please share the split between volume, price and mix in the second quarter, but also in your current trading number? And then a clarification on the event margin guidance upgrade considering also better like for like growth guidance why is the underlying market assumptions not really moving considering the upgrade feels driven mostly by the tariff recent thank you very much thank you for that uh kind words uh diary um uh on the the second quarter yeah the the overall volume so uh total uh is slightly positive in the quarter.

And when I'm thinking about total revenue growth, if you look specifically at like-for-like units, it's down two points, and then you have plus three on the pricing, then that takes us to the 1% like-for-like for the quarter. And then on current trading, We don't comment on that, but structurally, you should think the same on the pricing side, because we didn't do any pricing in between. Then on the underlying, you're right, technically with one percentage point higher, like for light growth, there's a little bit of operating leverage, all other things equal in that. But of course, it's not something that moves several percentage points on the margins that will be in the decimals. But we have decided of two things to note here. We have decided to invest a little bit more in reigniting our growth engines in different parts of the world. That includes Asia, where we want to put even more muscle behind. that becoming an even bigger growth driver in the years to come. And then secondly, we have bits and pieces on the freight cost from the Middle East crisis. It's not big money in our context. But net net, that means that the underlying margin is the same despite the revenue upgrade.

Thank you.

Thanks, Dian. Our next question will be from the line of Anthony Sharchafri from BNP Paiba. Please go ahead. Your line will now be unmuted.

Yes, thank you. Good morning. It's Anthony Sharchafri at BNP Paiba. I have two questions, please. The first one is on the tariff reimbursement, which is an interesting deal that you've done with a third party and leaving 23 cents to the dollar on the table. So just curious to know if you felt that there was a sense of risk on those reimbursements and why did you take the decision to book the cash in Q2 and Q3? is it a sign that potentially you could resume a share buyback as early as 2027? And my second question is, again, on the 2027 margin comments, maybe just on the commodity part, because I have quite a bit of a delta versus your indication of 250, 260 bips upside to the guidance on commodity. Could you just remind me the moving part? Because if you switch one-third of the silver consumption and it's switched to platinum, I get something closer to 400 bips instead of 250 bips. So maybe just some color on those sensitivity would be very helpful for me to understand why I got it wrong.

All right. Thank you for those questions, Anthony. Let me start with the tarry. So, yeah, you're right. We sold the claim back in early May based on an evaluation of the risk of whether the funds would actually ever come back. we had quite extensive discussions about that both how long time it could take before cash would be returned if ever by the u.s government and therefore we decided to monetize the claim and sell it so we got the money that was received the 55 million u.s dollars we received back in in the first part of the first half of May. And we know that several companies or many companies around the world decided to do that, but it was based on a risk reward compared to the discount that we had to sell the claim at. The accounting around this is under IFRS is actually rather complex, but all the cash is sitting on the bank account they they have they have been received and then on the ifrs how accounting how that works is that even though we've sold the claim on a non-recourse basis uh so it's full and and and final then we can only take the income uh in the pnl as such as the refund administrative process in the U.S. is progressing. That led to $28 million coming into the books in Q2, and we expect the majority to come here in the second half of the year, maybe in Q3, maybe in Q4. That still remains to be seen. And on the share buyback, you're right. Of course, everything helps when we're getting cash into the bank, but it's still too early to go down the line of reinitiating a share-by-back program. I think if you do a little bit of math with the 2027 margin, you would see that we would be above the leverage range next year if we started out a share buy back program either this year or next year. In fact, that doesn't mean that we wouldn't end up concluding that a share-by-back program next year might be appropriate, even though it would lead to leverage being a little bit above the range for a short time as we transition into platinum plate. But that's too early to decide and communicate anything on. and that will be a part of the 2027 communication. And of course, also when we come out with a full year guidance for next year, in February, next year, we will talk about how we look at it at that point in time. But I think it's very important to stress, it's not a question of, if we start Share Buy Back programs again, it's only a question of the timing during this transition into platinum-plated for a part of the jury, and then the consequent increase in leverage that we will see just by pure math, because the margin will go down next year compared to this year. So more to come on that. And then on the 2027 margin, high level, the way to think about the silver sensitivity, if we take that one specifically, then in 2026, so this year, the sensitivity is around that if the silver moves one US dollar, then the margin changes 20 basis points and now with the level of transition that we're doing from silver to platinum then next year that sensitivity goes from the 20 to around 13-14 basis points. That's just step one and then the sensitivity will go down even further next year, but if you're using 13 basis points sensitivity per one US dollar, then the upside on the margin next year would be $17 lower from 82 to 65. That's now being hedged times 13, and that gives you 214 basis points to be precise, but let's call it 200 basis points of margin upside and then i i'm happy to go through the marathon gold and platinum or we can follow up separately afterwards with with ir but there the sensitivity is obviously still much lower and that that would give 25 to 30 basis points uplift on each and there the spot price the prices that we're using is that in the original announcement back in February we used a gold price of just about $4,700 and getting to the 25 to 30 basis points upside we are using a gold spot price of $4,400. An equivalent on platinum is from $2,400 originally to now around $1,600 spot price for platinum but again i'm happy to go through the it and reconcile the the the the math that you had on your uh in your mind okay thank you and just to confirm in terms of silver usage your assumption still take into account yeah a reduction of one third exactly yeah okay Okay, thank you.

Thanks, Anthony.

Our next question will be from the line of Andrea Thorman from Danske Bank. Please go ahead, Joll, I will now be unmuted.

Thanks for taking my questions. I have two as well. So first question is regarding this promotional detoxing you mentioned, Anders, in the second half to come. Can you maybe tell a bit more about where this will be in the world? And then second question is regarding the U.S. like for like in the second half. Can you maybe put some words on why we won't see a significant uptake in like for like with coms coming significantly down in the U.S. for the second half? That's been gracious.

Yeah, so why don't I start with the retail discount? I would say that what you will see, you should expect to see this is pretty much across all markets. markets, but we have, as well, a higher focus on our mature markets, so you should expect to see a reduction on the UK, on Italy, et cetera, as the biggest reduction. Of course, when you look at the retail discounts, you will see a big decline, or what we are seeing is a big decline on the retail discount level on LATAM. As a reminder, there was a change from a high-low positioning in the previous year to the beginning of this year, getting the same prices in line with the rest of the pricing corridors on the rest of the world and substantially reducing the promotion to nearly half of the days. So long answer short is across all markets, but we are focusing heavily on the mature markets, which is where we saw the highest increase in the last two years.

And I'm sorry, Andrea, I didn't get the second question.

So I just asked why we won't see a strong like-for-like tick-off in the second half for U.S. when the comps are much lighter.

Okay, let me start. And again, Andres, you can complement. I think we discussed it in the call. I mean, we are not claiming victory yet. We are seeing strong signs that our model is working. But if you look at it, our like-for-like growth on core is still negative. I can look, of course, at what is happening on the collections and the base assortment in this market. So, we are sensible and we remain prudent with our approach. Yes, we are, the comps get easier, but at the same time, and I answered just before, we are seeing a decline on our promo details as well, which in the U.S. it was really on our offline, but also on our online, on our e-commerce store where we were promoting slightly heavily on quarter three, adding more days in addition to the Black Friday weeks, etc. So those days of extra promo outside of the big commercial periods will go away and that will have an impact. And of course, last but not least, this is a market where the consumer sentiment is still low, at record lows. We see jewelry increasing and then we could be very happy about that. But when you double click on that, it's actually on the high income. So the The accessible jewellery market is still declining, and this was in quarter one and quarter two. So, really, we are just looking at the facts and making just sensible decisions for the rest of the year.

Thanks, Andai. Our next question will be from the line of last hop on from B&B. Please go ahead, Yolanda, I'll be unmuted.

Just a couple of brief follow-ups, please. on the current trading and this uptake from Q1 to the mid-single-digit level in the beginning of Q3. Can you comment on, is this broad-based? Is it specific markets driving this? And the second follow-up question, Bertrand, you gave a comment on the performance in mature markets being related to how the core performs. So just wonder if you can give some numbers on the distribution between core revenue and fuel with more revenue in some of your less mature markets like LATAM, Japan, Spain, compared to the group average where fuel with more is 26%. Is that a significantly higher share in some of these younger markets?

Lars, so it's relatively broad-based. The commercial phasing had quite a consistent effect across all regions, really. Yeah, Sandra Burt, on the second.

Yeah, I think on the thing you should explain, when you look at all the mature markets and when you look at NAMM and EMEA, and given that, you know, that is really the biggest part of our market, the split is the same. What we are seeing is slightly different is when we start new markets like Japan, where we are seeing that it's slightly more, let's say, balanced between the core and the fuel with more. But on the majority of our business is exactly the same.

So this would also imply profitability incrementally is better in like last time, Japan, since fuel with more has higher margins.

It's close to each other. So I think the gross margin between the two are so high or high. But strictly speaking, you're right.

Thanks, Lars. Our next question will be from the line of Christian Godigsen from SEB. Please go ahead. Your line will now be unmuted.

Thank you. Also a couple of follow-ups from me. So maybe could you comment a bit on the relative read performance in the online channel this year compared to the underperformance of the physical stores contrary to the last many years. And then secondly, could you elaborate a bit maybe on the, I noticed a jump in the unaided brand awareness in the mature markets for the younger groups in the first half of the year in 2026. It would be nice to have some more flavor on that. And then thirdly and lastly, comment a bit on the lower selling. I guess it's a bit contrary to me based on the performance of wholesale actually for a very long time, obviously it's underperformed. But this quarter actually it's doing better than your own stores, so yeah, it sounds a bit contrary to me that then they reduce their inventories. So happy to hear some thoughts on that. Thank you.

So why don't I start on the e-commerce? I mean, what do you see? I mean, we've been talking quite a lot on this call about the promo detox, and we were detoxing, of course, in the entirety of our business, so we do get less offer huntings that we will get actually on the e-commerce. I I think this is one of the biggest drivers. The second question was...

Unated brand awareness among the younger...

Yes, sorry, so that's good. So what it's important to say is that unated brand awareness continues to increase, which is important because, of course, as you know, we are moving from only reach to reach and relevance. So the shift on the marketing investments that are going more to earned media, PR, et cetera, is not in detriment of our reach. So we continue to increase that. What we are seeing as well is that recent activations that we have done has drove proportionally more Gen Z consumers into our brand so we continue to be cross-generational so and this is an important strength for Pandora but it is of course important that we are relevant to the new generation and what we've been doing in the last quarters in the first half of the year has actually increased the number of Gen Z consumer is slightly higher than the Millennials and the Gen X and on your last question question I think that that's very well framed and the where we see the lower selling is on the partners that are not sitting in the life like

base and and with the way that we build up our revenue growth rate starting with like-for-like, then the like-for-like base is, let's call it almost 90%, 85% to 90% of our revenue base. But then we have the small multi-brand partners, as an example, that is not counting in like-for-like, but obviously impacts our selling. And that's the main area where we see that drag on the selling and thereby the reported revenue. And we have seen for a while, that those partners are trailing the growth that we can generate in our own channels and in the partner concept stores, probably partly linked into the fact that we have a bigger marketing muscle that we can put behind that helps our own channels more but that that's the that's the that's the link into why we see this selling impact that's very clear just one very quick follow up and then just on the on the on the performance and like I'm sorry on the online channel so when when what about the structural impact are there any there when the promotional detox is done should we expect online to grow faster and then physical stores or how should you think about it exactly that's typically how we see it that the reaction online to promos is bigger than in the physical store so it when you if you do more promos you typically see faster growth online and case in point the second quarter here it goes the other way around as well.

Okay thank you. As we have no further questions in the queue I'll hand it back to the speakers for any closing remarks.

Yes so So, listen, just thank you very much for being with us today. We just like to remind everyone that we are not declaring victory, but we are seeing that the proof points are building, and this is just reinforcing our conviction on the direction and on the new growth model. I am looking forward to seeing you in November for our quarter three update and a more of a strategic update on all the other ships that we are planning for Pandora. So with that, just have a fantastic day.