RadioShack Corporation reported a larger-than-expected
quarterly loss on Thursday, as the struggling electronics retailer sold
fewer smartphones and mobile subscriptions. The three-month period
ending Nov. 1 marked the company’s eleventh straight quarter of losses.
Overall sales at RadioShack stores also fell and the
company said it will implement a number of cost-cutting measures to save
$400 million annually to
help reduce losses. The retailer’s revenue was
also drained by an ongoing fight over repayment plans with lenders, who
blocked a plan to close 1,100 underperforming stores, according to a Bloomberg report. RadioShack’s stock has dropped to one quarter of its value at the beginning of the year.
Most of RadioShack’s 13 percent decline in sales was due to
a drop-off in mobile-phone sales, which fell 25 percent from the same
period one year ago. While stores saw a boost in Thanksgiving weekend
sales, phone sales fell 27 percent compared to the same period last
year.
The retailer avoided questions from investors by cancelling a question-and-answer session scheduled to follow its conference call to discuss earnings.
CEO Joe Magnacca has instituted a number of cost-cutting
measures, including a halt on 401(k) matches for employees, according to
Bloomberg, and plans to save $295 million by pulling back on marketing
efforts, cutting store operations and management staff, and closing
stores.
Magnacca has also overseen a remodeling effort in select
stores, including interactive displays, in-store repairs and exclusive
products. Revamped stores saw a 12 percent increase over comparable
locations during the company’s third quarter, he said, with sales up 35
percent during the Thanksgiving weekend, excluding mobile.
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