On Thursday, the markets received a bit of good news from the Labor Department. Initial claims for state unemployment benefits fell 15,000 in the final week of December to a seasonally adjusted 372,000. However, retailers ( NYSEARCA:XRT ) are reporting mixed results for the holiday shopping season.
Bookseller Barnes & Noble Inc. ( NYSE:BKS ) said Nook sales grew 70 percent when compared to the prior year, but shocked the market by announcing it is looking at options to spin off the e-book reader. “We see substantial value in what we’ve built with our Nook business in only two years, and we believe it’s the right time to investigate our options to unlock that value,” William Lynch, the firm’s CEO, said in a press release. The announcement sent shares plummeting 30 percent in early trading. The move could prove to be another win for Apple’s ( NASDAQ:AAPL ) iPad. Amazon ( NASDAQ:AMZN ) also competes in the tablet industry with its Kindle line.
Other retailers also struggled as cash-strapped consumers were particular about their shopping lists. For December, Costco Wholesale Corp. ( NASDAQ:COST ) missed overall sales estimates as television sales experienced a double-digit decline. Sales at Target Corp. ( NYSE:TGT ) also missed estimates, as demand was lower-than-expected for electronics, music, movies and books. The discounter also reduced its fourth-quarter outlook to $1.35 to $1.43 per share, compared to a previous estimate of $1.43 to $1.53 per share.
Gap Inc. ( NYSE:GPS ) was one of the biggest disappointments on Thursday. The company, which owns Old Navy, Banana Republic and Gap stores reported a 4 percent decline in same-store sales for December. “We expected December to be highly promotional, and while we competed aggressively across our brands, our performance was below our expectations,” said Gap Chief Executive Glenn Murphy. Other retailers such as Stage Stores Inc. ( NYSE:SSI ) and Bon-Ton Stores Inc. ( NASDAQ:BONT ) also missed estimates. “Cold weather categories, which are highly profitable and represent approximately 25% of our business in December, were down mid-teens on a percentage basis,” explained Tony Buccina, Bon-Ton’s vice chairman, president of merchandising.
Consumers are still willing to shop at some specific retailers. Zumiez Inc. ( NASDAQ:ZUMZ ), Macy’s ( NYSE:M ) and Buckle Inc. ( NYSE:BKE ) all reported an increase in sales. Teen retailer Zumiez posted the biggest jump as sales jumped 10 percent. Nordstrom Inc. ( NYSE:JWN ) also reported a boost of 8.7 percent in same-store sales.
To contact the editor responsible for this story: Damien Hoffman at firstname.lastname@example.org
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