Sears Holdings Corp. (Nasdaq:SHLD) suffered a large third-quarter loss due to weaker sales at both Kmart and Sears stores, the company said in its earnings statement Thursday, Nov. 21.
The company reported a net loss of $534 million, or $5.03 per share, compared to a loss of $498 million, or $4.70 per share, a year earlier. Analysts were expecting the retailer to improve, predicting a $370.7 million net loss, or $3.48 per share, for the quarter.
Total revenue fell 7 percent to $8.27 billion from $8.86 billion mostly due to fewer Sears and Kmart stores operating. Revenue at stores open at least a year dropped 3.1 percent, accounting for a $170 million loss, with Sears reporting a 4 percent slip and Kmart locations down 2.1 percent.
Gross margin, the percentage of sales left after subtracting the cost of inventory, narrowed at both stores, declinding 2.1 percentage points.
The company said that turnaround efforts for the company will include more focus on the brand's Shop Your Way membership program, along with digital initiatives to make targeted offers to customers online and via social media.
"We are driving this transformation by investing in capabilities to enable members access to the broadest possible assortment of products and services, enhancing our membership benefits associated with Shop Your Way, developing digital and social relationships with our members, using data and analytics to make targeted offers and decisions delivered in real time and expanding our reach through Marketplace and delivery options," Edward S. Lampert, Sears Holdings' CEO, said in the earnings report.
This marks the sixth consecutive quarter that Sears Holdings, which operates more than 2,500 stores in the U.S. and Canada, has reported net losses. The company is currently exploring several alternatives for a rebound, including separating its Lands' End apparel and automotive service-centers units. Analysts estimate that a Lands' End spinoff and sale of the auto centers may raise as much $2.5 billion for the struggling retailer.
For more see:
This Sears Holdings Corp. press release
This Washington Post article
Sears May Split Lands' End, Auto Center Business; Reports Sales Drop
Sears Revamps Appliance Stores To Improve Customer Experience
Sears Canada CEO Leaves In Dispute Over Paying For Turnaround
Sears Had The Same Same-Store Drop As Macy's. How Can That Be?
Sephora Names Former Sears Canada CEO as New Chief Executive