Friday 22 June 2012

Bed Bath (BBBY) Forecasts Lower Quarterly Profit over Rising Costs

After Bed Bath & Beyond forecast a weaker-than-expected profit for the current year as it has to hasten its spending to improve its e-commerce business, its shares plunged 11 percent.

 

 The shares of the US home goods chain, Bed Bath & Beyond Inc (NASDAQ: BBBY), plunged 11 percent after it forecast a weaker-than-expected profit for the current year as it has to hasten its spending to improve its e-commerce business, in order to meet the challenge of incentives for shoppers for buying home goods online being rolled out by Amazon.com (NASDAQ: AMZN). 

Amazon launched home furnishings website Casa.com in February, which is being viewed by some analysts as a potential competitive threat to Bed Bath. Already Bed Bath reported decline in gross margin in the recently concluded fiscal first quarter as well as the fourth quarter of last year, which indicates that Amazon is tearing through its home furnishings business. Moreover, due to the financial crunch, more customers are going in for cheaper products. Read More.......

Resource Link Sharewell Newswire

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