UPDATE 2-RadioShack names CEO; challenges remain

Thu Feb 7, 2013 7:28pm EST
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By Dhanya Skariachan

NEW YORK Feb 7 (Reuters) - U.S. electronics retailer RadioShack Corp named Walgreen executive Joseph Magnacca as its new chief executive, hoping to boost sales by tapping his merchandising and marketing experience.

Magnacca, who will begin his job Feb 11, faces the tough task of transforming the electronics change into a specialist in selling mobile devices.

Despite its ubiquitous presence in the United States, RadioShack has not done enough to rebrand itself as a destination for mobile phones or to cater to younger customers, many on Wall Street have said.

The selection of Magnacca comes months after the retailer lost key executives including its merchandising chief and chief executive, and days before it was due to report results for the quarter covering the holiday season.

The retailer also faces aggressive competition from the likes of Best Buy Co Inc, Amazon.com Inc and stores operated by mobile phone companies.

RadioShack has been trying to focus more on selling more calling plans and smartphones, particularly Apple Inc's iPhone, but its profits have suffered because it makes less money on iPhones than on mobile devices that use the Android operating system.

While Magnacca brings a strong merchandising background to RadioShack, his experience appears to be "largely outside" the retailer's core competencies, "something that could be problematic as RadioShack's transformation continues," Barclays analyst Alan Rifkin said.   Continued...