Stock Market

Bed Bath & Beyond stock falls nearly 2% after ‘accelerated markdowns’ led to much wider-than-expected loss

Shares of Bed Bath & Beyond Inc. dropped 1.9% in premarket trading Thursday, after the home-goods retailer reported a much wider-than-expected fiscal second-quarter loss, as markdowns and promotions were accelerated to help fix a “significant dislocation” between sales and inventory.

The company
BBBY,
+1.25%

reported a net loss for the quarter to Aug. 27 that widened to $366 million, or $4.59 a share, from a loss of $73 million, or 72 cents a share, in the same period a year ago.

Excluding nonrecurring items, such as severance costs and other restructuring charges, the adjusted per-share loss of $3.22 was wider than the FactSet loss consensus of $1.79. That marks the sixth-straight quarter the company has missed bottom-line expectations.

Total sales fell 27.6% to $1.44 billion, just below the FactSet consensus of $1.45 billion, while same-store sales matched expectations of a 26.0% drop. That’s the fifth-straight quarter the company missed top-line expectations.

Gross margin contracted to 27.7% from 30.3%, to reflect the negative impact of accelerated inventory clearance. Merchandise inventories were valued at $1.58 billion as of Aug. 27, down from $1.73 billion at the end of February and just below the $1.59 billion a year ago.

Don’t miss: Bed Bath & Beyond’s turnaround plan leaves ‘questions that have really not been answered to any degree.’

“While our sales and profit results do not yet reflect the strategic and financial actions we have initiated to change our performance, they do demonstrate sequential progress in several key areas,” said interim Chief Executive Sue Gove.

Gove said that after suffering a significant dislocation between sales and inventory in the first quarter, the company started immediately addressing that dislocation in the second quarter. “Aggressive inventory optimization actions, including accelerated markdowns and strategic promotions, led to double digit improvement in this gap,” Gove said.

The results come after the “meme stock” suffered an asteroid-like plunge following a meteoric surge over the past couple months, as an active crowd of retail investors fended off cash concerns, job cuts, store closures, a sales warning and the death of its chief financial officer that was ruled a suicide.

Also read: About 150 Bed Bath & Beyond stores are closing — here’s the complete list so far.

The stock rocketed about 359% from the end of July to Aug. 17, then has plunged 72% since then through Wednesday’s close.

Looking ahead, the company reiterated the fiscal 2022 guidance range provided last month for a comparable sales decline “in the 20% range.”

So far this year, Bed Bath’s stock has tumbled 55.7% year to date through Wednesday, while the SPDR S&P Retail exchange-traded fund
XRT,
+3.44%

has sunk 33.4% and the S&P 500 index
SPX,
+1.97%

has shed 22.0%.

For more updates check below links and stay updated with News AKMI.
Life and Style || Lifetime Fitness || Automotive News || Tech News || Giant Bikes || Cool Cars || Food and Drinks

Source

Tags
Show More

Related Articles

Back to top button

usa news wall today prime news newso time news post wall

Close