Electronics specialty retailer RadioShack Corp. (RSH) reported Monday a decline in third-quarter profit, reflecting primarily a fall in the sales generated by company-operated stores and kiosks.
The Fort Worth, Texas-based company's net income for the third quarter declined to $37.4 million or $0.30 per share from $49.1 million or $0.38 per share in the previous year.
On average, 19 analysts polled by Thomson Reuters expected the company to report earnings of $0.31 per share for the quarter. Analysts' estimates typically exclude special items. In its second quarter, the company had posted higher profit in the absence of a one-time charge recorded a year ago. The company's second-quarter net income was $48.8 million, or $0.39 per share, compared with net income of $41.4 million, or $0.32 per share, last year.
Net sales and operating revenues for the recent quarter declined 3.1% to $990 million from $1.02 billion in the comparable period a year ago. Fifteen analysts had a consensus revenue estimate of $960.95 million for the quarter. The company noted that the decrease of 3.1% was attributable to a 3.5% fall in the sales generated by company-operated stores, a 17.8% decline in kiosk sales; and a 13.5% increase in other sales. RadioShack said its comparable same-store sales for company-operated stores and kiosks decreased 2.9% from the prior-year quarter, mainly due to sales declines in digital-to-analog converter boxes, laptop computers, batteries, wireless accessories, and GPS products. Meanwhile, the sales declines were substantially offset by increased sales in Sprint Nextel postpaid wireless business, increased sales of prepaid wireless handsets and airtime, the addition of T-Mobile as a postpaid wireless carrier, and increased sales of netbooks. The company noted that its gross margin rate during the third quarter increased 90 basis points, mainly driven by a change in sales mix away from lower margin products such as converter boxes, laptops and GPS into higher margin products such as postpaid and prepaid wireless. Total operating expenses increased to $401.7 million from $392.5 million in the earlier year. Consolidated selling, general and administrative expenses grew to $380.7 million from $370.4 million in the prior year, mainly due to the rise in compensation expense, legal settlements and advertising expense related to new brand creative platform, 'THE SHACK.'
Operating income was $69.4 million, down from $84.9 million in the year-ago quarter.
For the nine-month period, the company posted net income of $129.3 million or $1.03 per share, compared to $129.3 million or $0.99 per share in the same period last year. Net sales and operating revenues for the period were $2.96 billion, in comparison with $2.97 billion a year ago. Comparable same-store sales for company-operated stores and kiosks for the first nine months decreased 0.7% from the preceding year.
Capital expenditures for the first nine months were $62.1 million and the company said it continues to estimate that capital expenditures for the full year 2009 will be in the range of $75 million to $100 million.
Julian Day, chairman and chief executive officer said, "Two key strategic efforts continue to be primary areas of focus for the organization. First, the launch of the 'THE SHACK' brand platform was a success, and we will continue to refine and invest in this positioning. Second, the introduction of T-Mobile in our company-operated stores and Verizon Wireless in our Sam's Club Kiosks further enhances our mobility proposition. Together with AT&T and Sprint, we now offer a broader range of choices to fit consumers' needs."
Among others in the sector, Best Buy Co. Inc. (BBY) is set to announce its third-quarter results on December 15. Analysts project earnings of $0.41 per share for the quarter on sales of $11.93 billion.
Retailer Wal-Mart Stores Inc. (WMT) is expected to announce its results on November 12. Wall Street analysts forecast earnings of $0.81 per share on revenues of $99.87 billion for the quarter.
Another peer, Verizon Communications Inc. (VZ) today reported third-quarter net income of $2.9 billion or $0.41 per share, compared to $3.2 billion or $0.59 per share same quarter last year. On an adjusted basis net income was $0.60 per share, compared to $0.66 per share in the year ago quarter. Operating revenues for the quarter increased 10.2% to $27.3 billion from $24.8 billion in the comparable quarter last year.
RSH closed Friday's regular trading at $15.66 on the NYSE. In the past 52 weeks, RadioShack shares have been trading in a range of $6.47 - $17.45 on the NYSE.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.