RadioShack’s Net Income Falls On Higher Costs
Get Breaking News First
FORT WORTH (AP) - RadioShack Corp.’s first-quarter net income declined 30 percent, partly stung by bad weather and costs tied to paying off debt early.
The electronics retailer also lowered the high end of its full-year earnings forecast on Monday. The chain expects ongoing softness in the second quarter, but for business to improve in the second half of the year.
RadioShack reported net income of $35.1 million, or 33 cents per share, down from $50.1 million, or 39 cents per share, a year earlier.
This year’s quarter included 2 cents per share for costs related to early debt retirement.
Analysts surveyed by FactSet predicted 35 cents per share.
Revenue for the three months ended March 31 climbed 2 percent to $1.06 billion, buoyed by 11 percent growth in mobile devices. Wall Street expected $1.07 billion.
RadioShack has struggled with competition from online retailers like Amazon.com and bigger electronics chains like Best Buy. RadioShack has shifted its focus to smartphones and wireless plans and selling cell phones and products at mobile phone kiosks, with some success.
RadioShack, which informed T-Mobile in February felt the company “materially breached” its contract, said it is still working closely with T-Mobile to resolve the breaches.
RadioShack said the talks have been “constructive” and that it expects the matter to be resolved.
Looking ahead, RadioShack now expects full-year earnings of $1.60 to $1.80 per share. Its prior guidance called for earnings of $1.60 to $1.90 per share. The company still anticipates revenue will rise by the low to mid-single-digit percentage, mostly on mobile sales.
RadioShack, based in Fort Worth, Texas, has about 4,675 company-run stores in the U.S. and Mexico, more than 1,300 wireless phone kiosks in the U.S. and about 1,175 dealer outlets worldwide.
(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)