Why Bed Bath & Beyond Stock Falling In Pre-market?

Bed Bath & Beyond Inc. (BBBY) posted a fourth quarter comparable sales decline of 12% impacted by ongoing supply chain and inventory availability challenges. Bed Bath & Beyond banner comparable sales were down 15%, for the quarter. The buybuy BABY banner delivered positive growth with comparable sales increasing in the low-single digits. Fourth quarter adjusted gross margin was 28.8%, reflecting a 360 basis point negative impact from transient supply chain headwinds and a 40 basis point decrease in merchandise margins compared to last year. Excluding the supply chain cost escalations, adjusted gross margin was 32.4%, for the quarter.

"The lack of available inventory to sell proved to be a continuing impediment to sales through the remainder of the fourth quarter and into the early part of fiscal 2022. Specifically, despite our overall inventory levels, product in transit, not available for sale or held at port remained abnormally high, particularly in key items," said Mark Tritton, Bed Bath & Beyond's CEO.

For fiscal 2022, the company expects sequential comparable sales improvement to occur in the second half of fiscal 2022 versus the first half of fiscal 2022. Adjusted gross margin is projected to expand modestly from last year.

Fourth quarter adjusted net loss per share was $0.92 compared to profit of $0.40, prior year. On average, 17 analysts polled by Thomson Reuters expected the company to report profit per share of $0.03, for the quarter. Analysts' estimates typically exclude special items.

Net loss was $159.10 million or $1.79 per share compared to net income of $9.06 million or $0.08 per share, last year.

Net sales were $2.05 billion, down 22% from a year ago. The company said this reflects a 8% decline related to a planned reduction from non-core banner divestitures and a core sales decline of 14%. Analysts on average had estimated $2.07 billion in revenue.

Shares of Bed Bath & Beyond were down 7% in pre-market trade on Wednesday.

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