Sears Holdings Corp (NASDAQ:SHLD) shares are down over 6% on Thursday due to a disappointing second quarter earnings report. The iconic retailer has been trying to stem the losses and begin a turnaround for some time now, but unfortunately the losses are continuing to pile up, with another $573 million loss reported in the second quarter.
The mainstream, largely brick and mortar retail firm has seen losses pile up for a couple of years now as management tries to transition from a traditional retailer into a business that relies on loyal shoppers who are offered personalized deals.
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Details on Sears second quarter earnings report
Sears Holdings Corp (NASDAQ:SHLD) reported a net loss of $573 million ($5.39 loss per diluted share) for the second quarter of 2014, compared to $194 million ($1.83 loss per diluted share) for 2Q 2013. Adjusted EBITDA was $(313) million for the second quarter of 2014, compared to $(78) million in 2Q 2013. The 1H 2014 losses totaled $975 million.
The firm’s 2Q revenue declined to $8.01 billion from $8.87 billion in 2Q 2013.
Statement from Sears CEO Lampert
“We have continued to show progress in our transformation, as demonstrated by our year-over-year increase in online and multi-channel sales, and with our member sales now representing 73% of eligible sales,” explained Edward S. Lampert, Sears Holdings’ CEO in a statement accompanying the second quarter earnings. “However, our second quarter earnings are unacceptable and we are taking steps to address our performance on several levels. This includes reducing costs as we evolve our business model, investing in our Shop Your Way and Integrated Retail customer initiatives, rationalizing our physical footprint and improving pricing and promotions. As we move through the transformation, our new programs are becoming more prominent both in how we run the company and in how we serve our members, and we are pleased with how our members are responding.”
Sears Shop Your Way rewards program
The retailer’s new Shop Your Way rewards program is a key part of its ongoing turnaround effort. The goal is to carefully monitor Shop Your Way member browsing and shopping habits and use that info to provide a more useful, custom shopping experience.
In one bit of good news in the gloomy 2Q report, members of Sears free Shop Your Way rewards program represented 73% of sales in the second quarter, and its online sales in the quarter grew 18% from the year-ago quarter.