Indianapolis – Hhgregg reported net income of $5 million during the third quarter of fiscal 2014, a 71% drop from $17.4 million in the same period the previous fiscal year. Net sales declined about 12%, from $799.6 million to $707 million.
Same-store sales decreased about 11%. Hhgregg cited the drop in same-store sales and shrinking gross margins for its steep decline in net income. Dennis May, president and CEO of Hhgregg, blamed poor electronics/computing sales and heavy promotions for the retailer’s overall disappointing performance.
“As previously reported, our sales of consumer electronics and computing and wireless products were significantly below our expectations during the quarter,” said May. “The broad distribution of these categories across a variety of retail formats combined with the intensely promotional environment led to a challenging operating environment for Hhgregg. While disappointed with the holiday industry trends, we took a balanced approach, choosing not to fully participate in the heavy promotional environment and proactively managing our inventory levels to match the product demand of our business.”