Fort Worth, Texas — RadioShack Corp. reported a widening net loss in the first quarter of its fiscal year 2015. The troubled retailer also confirmed plans to close up to 200 stores, based on location, area demographics, lease life and financial performance.
The retailer reported a net loss of $98.3 million, up from $28 million in the same quarter the prior fiscal year.
Net sales dropped 13% to $736.7 million from $848.4 million. RadioShack attributed its generally poor performance to factors including soft mobility sales, aggressive price competition, lower store traffic and higher expenses.
“Overall, our first quarter performance was challenged by an industry-wide decline in consumer electronics and a soft mobility market which impacted traffic trends throughout the quarter,” said Joseph D. Magnacca, CEO. “In particular, our mobility business was weak due to lackluster consumer interest in the current handset assortment and increased promotional activities across the industry including the wireless carriers. This resulted in disappointing sales and gross margin performance."
On a more positive note, Magnacca said the chain’s new concept stores continue to drive strong sales growth, and it has begun to execute a 100-store remodel program to scale the successful components of the format across its network.
"We are also successfully reducing our costs, with a particular focus on removing expenses that do not impact the customer experience, and have taken steps to lower our corporate headcount, leverage technology, and reduce discretionary expenses,” he said. “Our entire team is focused on executing our vision, adapting to the environment, managing our balance sheet, and driving sustainable change."