A man is seen at a Bed Bath & Beyond store in New York on January 5, 2023.
Ziyu Julian Zhu | Xinhua News Agency | Getty Images
Bed Bath & Beyond posted higher-than-expected quarterly losses on Tuesday as the chief executive admitted the struggling retailer’s turnaround plan had fallen short of its goals.
Days after the company warned of a possible bankruptcy, it reported negative operating cash flow of $307.6 million for the third quarter and rising net losses.
Bed Bath lost $393 million during the period, it said Tuesday, worse than the $385.8 million quarterly loss it forecast just last week and 42% larger than the loss it reported in the year-ago quarter.
The quarterly losses include an impairment of about $100 million related to “certain store-level assets,” the company said Tuesday.
CEO Sue Gove said Tuesday the company is working to “timely” address its cascading financial woes. She repeated the company’s press release in comments on a roughly 10-minute earnings call and declined to answer analyst questions.
Here’s how the retailer has fared in the three months ended November 26, compared to analysts’ expectations based on Refinitiv data:
- Loss per share: Adjusted $3.65 vs. $2.23 expected
- Revenue: $1.26 billion versus $1.34 billion expected
The company’s net loss increased to $393 million, or $4.33 per share, from a loss of $276 million, or $2.78 per share, a year ago.
Comparable sales declined 32%. Comparable sales for the Bed Bath & Beyond banner of the same name were down 34%, and Buybuy Baby’s comparable sales decline was in the low 20% range.
Last week, the company previewed its net sales for the fiscal third quarter and said they were expected to be about $1.26 billion — down from $1.88 billion in the same period last year.
This advance notice from the home goods retailer, which is struggling to stay in business, came with a going concern warning. The filing states that it is running out of money to cover costs and may have to file for bankruptcy. It said it was struggling to attract customers to stores and reverse declining sales.
Also, the company says, it has become more difficult to keep shelves stocked as suppliers adjust payment terms or stop shipping goods due to Bed Bath’s financial woes. The company’s market value has fallen to a meager $142.8 million. Still, its shares are up about 12% in premarket trading on Tuesday.
“While we have moved quickly and effectively to change assortment and other merchandising and marketing strategies, inventory has been limited and we have not met our goals,” Gove said in Tuesday’s press release.
Still, she said, the retailer has aggressively cut costs and is on track to close its previously announced 150 stores. Operating expenses decreased to $583.6 million compared to $698 million last year.
“Our organization is streamlined and we have introduced a more focused infrastructure that reflects our current business,” Gove said.
The retailer includes three banners: its namesake, its baby supply chain Buybuy Baby; and his health and beauty banner Harmon.
This story evolves. Please check again for updates.
