In what has become a familiar sight in the retail segment, shares of Bed Bath & Beyond (BBBY) tumbled more than 15% yesterday after the company missed on both the top and bottom line expectations. This was one of the worst single-day decline in five years. Revenues came in at $2.94 billion, down 1.7% YoY and missing analysts estimate by $70M. The company missed on earnings by miles. The company reported adjusted EPS of $0.69 while analysts were expecting an EPS of 93 cents. EPS numbers were propped up by share buybacks. Actual fall in net profit was even worse.
This is not all. The company slashed its FY-2017 EPS guidance to $3, a decline of 34% from last year and a far cry from analysts forecast of $4.01 a share. It was also worse than what company had indicated earlier. In April, BBBY had said that 2017 earnings could fall by 10% which would have resulted in an EPS of $4.12. Same-store sales, which is one of the most closely watched metric in the retail industry, also disappointed. The company reported a same-store sales decrease of 2.6 percent. Analysts had expected a decrease of 0.7 percent. Comparable sales were dragged down by in-store sales which registered a decline in the mid-single-digit percent range. Digital channel comparables actually showed strong growth. The retailer's comp sales have been declining over the past few years. This is a secular trend and not a one-off decline.
