Bed Bath & Beyond (NASDAQ: BBBY) shares fell 28% on Thursday after missing second-quarter earnings expectations. The company has taken a hit amid the ongoing spread of the Delta variant as well as supply chain issues.
The American retailer reported earnings of USD0.04 per share, compared to the expected USD0.52 a share. Furthermore, revenue amounted to USD1.99 Billion, lower than analysts anticipated USD2.06 Billion.
“From a strategic point of view and a tactical point of view we are unchanged from our strategy, we have the team, we have the talent, we have the strategy. The strategic tools are working incredibly well, whether it’s our owned brand, the reformation of supply chain momentum, all the work we’ve been doing with assortment, pricing and promotions. We’ve been really good about store models. All those things are moving, absolutely beyond our expectations. This is the pothole in the road, and so we have to manage the goodness now of our green shoots and continue to share that with the Street and the media. So, we are on track for our overall transformation goals,” explained CEO Mark Tritton.
According to Wells Fargo retail analyst Zachary Fadem, the company’s second quarter setback “undeniably casts doubt” of its ability to carry out its multi-year turnaround plan.
“After several encouraging steps forward, Bed Bath & Beyond took a big step back in Q2,” Fadem said in a note to clients.
Bed Bath & Beyond now predicts third-quarter earnings to vary between breakeven and USD0.05 per share with sales between USD1.96 Billion to USD2 Billion. Analysts had predicted third quarter earnings of USD0.28 per share and sales of USD2.02 Billion, according to Refinitiv.