Image Source: Signet Jewelers.

What: Shares of Signet Jewelers (NYSE:SIG) slumped on Thursday following the company's first-quarter earnings report. Results were mixed, with the company beating estimates for earnings, but missing estimates for revenue. At market close, the stock was down about 10.5%.

So what: Signet reported quarterly revenue of $1.58 billion, up 3.2% year over year, but about $30 million shy of the average analyst estimate. Same-store sales increased by 2.4% year over year, or by 3.9% adjusted for currency. The company's Sterling Jewelers division, which includes the Kay and Jared brands, posted 2.3% same-store sales growth, while the Zale division reported 2.5% same-store sales growth.

Non-GAAP EPS came in at $1.95, up 20.4% year over year, and $0.01 better than analyst expectations. GAAP EPS of $1.87 was up 26.4%. The company stated that the integration of Zale, which Signet acquired two years ago, is progressing according to plan, and that it's conducting a strategic evaluation of its credit portfolio.

Signet CEO Mark Light pointed to the company's success despite a difficult environment. "We gained profitable market share despite a challenging retail environment through strong sales of Ever Us and other fashion jewelry collections, as well as select branded bridal. Our 26% EPS growth was driven by higher same-store sales and total sales along with solid expense management and synergies, leading to 190 basis points of operating margin expansion."

Now what: Signet expects same-store sales to increase by 1%-2% during the second quarter, with adjusted EPS between $1.49 and $1.54. For the full year, 2%-3.5% same-store sales growth is expected, with adjusted EPS in the range of $8.25 to $8.55.

Signet's same-store sales growth is slowing, down from 4.9% during the fourth quarter, and a further slowdown is expected during the second quarter. Signet does expect to expand its store base this year, planning for a 3%-3.5% increase in net selling square footage, and further synergies from the Zale acquisition could boost the bottom line. But there was enough bad news for investors to sink the stock on Thursday.