(Updates with CEO, analyst comments, byline)

By Aarthi Sivaraman

NEW YORK (Reuters) - U.S. jeweler Zale Corp (ZLC.N: Quote, Profile, Research) posted a lower quarterly profit on Thursday, hurt by a significant drop in sales as cash-strapped shoppers backed off from jewelry purchases during the holidays.

Zale, whose shares fell more than 2 percent, has been struggling to counter flagging sales by taking steps such as polishing its customer service to lure shoppers back into its core mall-based stores.

Like other jewelers, Zale has suffered as shoppers battle higher costs for food and fuel and cut back on nonessential purchases, spending instead on everyday items like groceries.

Neal Goldberg, who replaced Betsy Burton as chief executive in December, called its results "disappointing."

"Our top line was challenged across all brands," he said during a conference call. "Promotional pressures intensified due to weaker customer spending and the lack of mall traffic."

Excessive inventory in the period only added to its problems, Goldberg added.

Zale's net profit fell to $60.8 million, or $1.34 a share, in the fiscal second quarter that ended Jan. 31, from $88.1 million, or $1.80 a share, a year earlier.