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Bed Bath & Beyond stock drops after company says sales down

Weeks after Bed Bath & Beyond disclosed which of its namesake stores would close, the company warned of “pressures on the business.”

The New Jersey-based home goods retailer announced in a news release Tuesday that December and January comparable sales were down 5.4% driven by “store traffic declines combined with inventory management issues, and increased promotional activity and markdown.”

“We are experiencing short-term pain in our efforts to stabilize the business, including the pressures of store traffic trends coupled with our own executional challenges,” CEO Mark Tritton said in a statement, noting online sales growth of 20%. “I believe we can solidify this growth, while also addressing the broader stabilization of our business.”

Shares fell $3.76 or 25% in after-hours trading, dropping to $11.10.

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Tritton joined Bed Bath & Beyond Inc., which also operates buybuy Baby, Harmon Face Values and World Market, in early November and was an executive at Target.

“We are beginning to make bold and broad-based changes to modernize our business and better serve our customers,” Tritton said in the statement. “Our ability to achieve this and change the trajectory of our current results will take time, as we remaster the fundamentals of merchandising, pricing and promotion, and focus on our digital channels as part of our go-forward strategy.”

Product availability was a contributing factor to the sales decline, the company said, and “inventory within certain key categories in the Bed Bath & Beyond assortment was too low or out-of-stock during the period.” According to the release, the company is “immediately reforming its internal planning and inventory management procedures.”

During a Jan. 8 quarterly earnings call with analysts, company officials said they still plan to close 60 stores across all of its concepts but that 20 of the 40 Bed Bath & Beyond stores scheduled to close would be delayed until the first half of the year. Fourteen locations shuttered in late 2019.

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