Plano, Texas -- J.C. Penney Co. reported Friday a bigger-than-expected second-quarter loss of $147 million, compared with net income of $14 million in the same period last year.
Sales plummeted 22% to $3.02 billion from $3.9 billion, and same-store sales tumbled 21.7% after an 18.9% fall in the first quarter. Wall Street had forecast revenue of $3.2 billion.
Facing the investment community on Friday, CEO Ron Johnson admitted to some strategic pricing mistakes, but said he and his team will stay the course.
"We have now completed the first six months of our transformation, and while business continues to be softer than anticipated, we are confident the transformation is on track," said Johnson in a statement. “The transition from a highly promotional business model to one based on everyday value will take time and we will stay the course."
In February, J.C. Penney launched a new pricing plan that eliminated its long-time sales approach and implemented a three-tiered everyday low pricing strategy that has left customers confused. On Aug. 1, the pricing plan was tweaked again and terminology such as “Best Price” sales are now called “Clearance,” in hopes, said Johnson, that customers will better understand the pricing strategies. A new series of ad campaigns are also intended to clear up any confusion. Other changes in the works include 200 in-store jeans shops by 2015 and enhanced service areas call Town Squares.
"We continue to learn and adjust, and fully expect that our unique, specialty department store experience will drive J.C. Penney's long term success,” said Johnson.
The changes, however, will take time. The company said Friday it no longer expects to meet its earnings guidance for 2012.