LOS ANGELES (AP) — Shares of Guess Inc. dropped on Wednesday after the Los Angeles-based jeans wear company reported a 45 percent decline in second-quarter earnings and issued a disappointing profit outlook.
"Overall, second-quarter earnings were consistent with our expectations, but were short of our operational goals due to a soft environment in North America, where traffic and promotional activity have continued to put our brick and mortar stores under pressure," said Paul Marciano, CEO of Guess, in a statement. The company did say that it was encouraged by its e-commerce business, which increased by nearly 50 percent from the year-ago period.
The company said it earned net income of $22 million, or 26 cents per share, in the quarter ended Aug. 2. That compares with $39.9 million, or 47 cents per share, in the year-ago period.
The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 28 cents per share.
The clothing company posted revenue of $608.6 million in the period, down 4.8 percent from a year ago.
For the current quarter ending in October, Guess expects its per-share earnings to range from 15 cents to 20 cents. Analysts expect 38 cents per share, according to FactSet.
The company also said it expects annual earnings to be in the range of $1.05 to $1.20. Analysts expected $1.46 per share, according to FactSet.
Shares fell more than 7 percent, or $1.86, to $23.78 in after-hours trading on Wednesday, after closing down 19 cents to $25.64 in regular trading.
Guess shares have decreased 17 percent since the beginning of the year.
Original headline: Guess misses 2Q profit forecasts
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