Blood Bath At $BBBY: Hopes and Dreams Shattered After Gigantic Earnings Miss

They’re guiding way down on earnings, a long winding staircase into the abyss of a retail landscape, post Amazon, in ruins. Shares were already down in excess of 55% over the past year, prior to this harrowing calamity. With these numbers catching even the most bearish off-guard, you should expect carnage in the after-hours, carnage in tomorrow’s pre-market, and a blood bath to ensue during tomorrow’s trade.

Over the past two years, BBBY had kept up the canard by issuing big discounts, which left sales flat and earnings dropping off the cliff, to the tune of 30%. Apparently, their efforts to increase foot traffic have failed and the chickens are now coming home to roost.

Shares are off another 13% in the after hours.

Reports Q2 (Aug) earnings of $0.67 per share, $0.28 worse than the Capital IQ Consensus of $0.95; revenues fell 1.7% year/year to $2.94 bln vs the $3.01 bln Capital IQ Consensus.

Comparable sales in the fiscal 2017 second quarter decreased by ~2.6%. Comparable sales from customer-facing digital channels continued to have strong growth in excess of 20% for the 13th consecutive quarter, while comparable sales from stores declined in the mid-single-digit percentage range during the fiscal 2017 second quarter.

Includes the unfavorable impacts of approximately $.08 per diluted share of cash restructuring charges associated with the acceleration of the realignment of our store management structure announced on August 3, 2017. The estimated costs associated with the impact of Hurricane Harvey of approximately $.02 per diluted share; and the impact of the new share-based payment accounting standard of approximately $.01 per diluted share.

Co issues downside guidance for FY18, sees EPS of $3.00 (prior: down LSD-10% from $4.58) vs. $4.00 Capital IQ Consensus Estimate.

The Co’s planning assumptions reflect actual results through the fiscal second quarter and the continuation of the trends the Co has been experiencing, and the unfavorable impacts of: the cash restructuring charges associated with the acceleration of the realignment of our store management structure; Hurricanes Harvey and Irma; the adoption of the new shared based payment accounting standard; and further increases in its overall expense structure to reflect some of the accelerated spending associated with the Company’s organizational changes and transformational initiatives. The Company is now modeling net earnings per diluted share for the full year to be about $3.00, with the balance of the net earnings per diluted share to be split approximately 20% in the fiscal third quarter and approximately 80% in the fiscal fourth quarter.