RadioShack reports 2Q profit 1 hour, 3 minutes ago

RadioShack reports 2Q profit 1 hour, 3 minutes ago



FORT WORTH, Texas - RadioShack Corp. said Monday it swung to a second-quarter profit from a year-ago loss, but a 15 percent decline in revenue sent the electronic retailer's stock tumbling.

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RadioShack reported net income of $47 million, or 34 cents per share, for the three months ended June 30 versus a loss of $3.2 million, or 2 cents per share, a year ago.

Revenue fell to $934.8 million from $1.10 billion in the previous year. Its same-store sales — sales at stores open at least a year — fell 8.9 percent during the quarter, hurt by its post-paid wireless business.

The revenue decline sent the company's shares down $3.40, or 11.8 percent, to $25.40 in late morning trading Monday after sinking as low as $24.63 earlier in the session.

The latest quarter's results included a $10 million gain from the reversal of an income tax contingency reserve.

Analysts polled by Thomson Financial had expected earnings of 25 cents per share on higher revenue of $982.5 million. The earnings estimates typically exclude one-time items.

Some analysts had expected RadioShack to post better results due to store closings, layoffs and other cost-cutting moves.

Julian Day, a turnaround expert hired last year, has cut spending but has been unable to reverse RadioShack's slide in sales of wireless phones, a key part of its business. RadioShack has struggled since breaking ties with Verizon Wireless and faces competition from big-box retailers such as Best Buy Co. and Circuit City Stores Inc.

Even the most optimistic analysts have said the company would struggle to meet financial targets after the second quarter unless it could boost sales. Monday's report seemed to cast doubt on the chain's ability to do that.

RadioShack's stock price had more than doubled this year until early July, when it began slumping. Despite the recent drop, the shares were still up 72 percent for the year through Friday.