Domestic merchandise retailer Bed Bath & Beyond’s stock took a 12-point hit after Wall Street got a look at its latest earnings report and did not much like what it saw.
Same-store sales — the Street’s favorite metric for physical retail — were down 2.6 percent, according to the most recent numbers, and analysts were only anticipating a 0.7 percent decline. While digital channel sales were up more than 20 percent, it was not sufficient to overcome the same-store sale plummet.
Retail sales clocked in at approximately $2.9 billion, a decrease of approximately 1.7 percent from the same time last year. Coming out of a mediocre report, the retailer noted Hurricane Harvey, restructuring costs and new accounting standards had a heavy hand on the scale for last quarter’s results.
“How [customers] discover product, their expectations and knowledge around pricing and services offered, and how they share their thoughts about their shopping experiences, are all changing rapidly,” said Steven Temares, Bed Bath & Beyond’s CEO, on a Tuesday (Sept. 19) call with analysts and investors.
Going forward, Temares outlined initiatives for the retailer, including adoption of a new technology model, finding a new chief information officer and establishing a strategic portfolio management office.
The domestic goods retailer is also moving to cut staff and close under-performing storefronts, a strategic move that has been seen with many retailers. The decision to drop 880 department and assistant store manager positions earlier this year falls under that same restructuring effort.
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Online sales represent just 15 percent of Bed Bath & Beyond’s sales, Temares said, meaning there is still room for “significant growth.”
Bed Bath & Beyond also recently announced it will open a new fulfillment center in Las Vegas this fall, covering 525,000-square-feet of space, according to Temares. The company is also looking to expand same-day delivery services for several large cities and metropolitan areas, including Dallas, Houston, Washington, D.C., two additional boroughs in New York City and Seattle.
