RadioShack posts wider-than-expected loss
By Dhanya Skariachan
(Reuters) - U.S. consumer electronics chain RadioShack Corp RSH.N reported a much wider-than-expected quarterly loss on Tuesday, hurt by weak margins in its smartphone business.
The dismal results came less than a month before the unofficial start of the all-important holiday season, raising fresh concerns about the future of the retailer, which recently lost its merchandising chief and its chief executive.
"We believe that RadioShack continues to struggle both strategically and operationally and the management reshuffles simply augment the challenges," RBC Capital Markets Scot Ciccarelli said earlier this week.
RadioShack has been increasingly focusing on selling more calling plans and smartphones, particularly the Apple Inc (AAPL.O: Quote) iPhone.
Profit margin on iPhones is significantly less than on mobile devices that use the Android operating system, analysts and other industry-watchers have told Reuters.
Unlike in the past, most of RadioShack's major wireless partners - Sprint Nextel Corp (S.N: Quote), the Verizon Wireless venture of Verizon Communications Inc (VZ.N: Quote) and Vodafone Group Plc VOD.L and AT&T Inc (T.N: Quote) - are now pushing the more heavily subsidized iPhone.
The net loss was $47 million, or 47 cents a share in the third quarter, compared with year-earlier net income of $300,000, or nil per share.
Excluding impairment charges and other one-time items, the loss was 33 cents a share, while analysts on average were looking for a loss of 17 cents, according to Thomson Reuters I/B/E/S.
Net sales fell to $1 billion from $1.03 billion a year earlier. Sales at stores open at least a year fell 1.6 percent.
(Reporting by Dhanya Skariachan in New York; Editing by Lisa Von Ahn and Gerald E. McCormick)
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