In a development that would come as a major disappointment for Bed Bath & Beyond Inc. (NASDAQ:BBBY), BBBY stock fell sharply after the company’s latest performance proved to be a disappointment.
Company Warns on Holiday Sales
The company reported its performance for December and January, showing that one of the key metrics of its sales actually fell. This is another indication that all is not well with the home furnishings company, and the road back to steady growth might still be a long way away.
The sales metric in question that brought about this selloff was comparable store sales, which is regarded as an important metric of performance in retail. Bed Bath & Beyond experienced a 5.4% drop in comparable-store sales in December and January. The company stated that there was lower traffic at the stores and also blamed “inventory management issues” for this state of affairs.
The news instigated heavy selloff in BBBY stock during Wednesday’s trading session, which fell by as much as 26.36% to $10.94.
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The Chief Executive Officer of the company, Mart Tritton, said of the issues: “We are experiencing short-term pain in our efforts to stabilize the business, including the pressures of store traffic trends.”
“However, we did achieve a notable positive shift in sales in our digital channels during this period, with growth of approximately 20%,” he added.
After today’s sharp fall, BBBY stock has lost as much as 35% this year so far. Despite the problems with comparative store sales, Bed Bath & Beyond managed to experience significant improvement in sales through digital channels, as noted by Tritton. Digital sales soared by as much as 20%, but it remains to be seen if the company can further grow these sales in the upcoming quarters.
BBBY stock investors should keep an eye on any developments over the coming days.
Featured image: DepositPhotos © davidewingphoto
