Staples to close 225 stores, cut $500 million in costs

Staples (NASDAQ: SPLS) will close up to 225 stores in North America by the end of next year as it seeks to trim about $500 million in costs annually by 2015. The retailer says nearly half of its sales are now generated online, so it will aggressively shutter underperforming stores to focus more resources on e-commerce expansion.

The announcement was made during Staples' earnings report Thursday. Staples joins RadioShack and Sony who have struggled to maintain brick-and-mortar business as more consumers purchase lower-priced electronics and office supplies online. Staples currently operates 2,000 stores in North America after shuttering 109 stores in the twelve months preceding 2013′s fourth quarter.

Staples reported $5.87 billion in fourth quarter sales, missing analysts' expectations of $5.97 billion and reflecting a 10.6 percent drop year-over-year. The company earned a profit of $388 million, a 28 percent drop over the same time last year.

Staples joins several retailers that have noted the shorter holiday season and snowy winter weather as having an ill effect on quarterly business. Ron Sargent, Staples chairman and CEO, told investors on an earnings call that the chain was also "negatively impacted by not having Apple hardware in stores during holidays." Staples currently sells some Apple (NASDAQ: AAPL) products in roughly 900 of its stores, however iPhones and Mac computers are still not offered by Staples. Staples first started carrying certain Apple devices and accessories in February 2013, and Sargent remarked that the relationship between the two brands "continues to evolve."

For more:
-See this Staples earnings report

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