JCPenney Co. Inc. (NYSE: JCP) reported an adjusted second-quarter net loss of $0.37 per share and $3.02 billion in revenues before markets opened today. EPS for the same period a year ago came to $0.13, and last year’s revenue totaled $3.9 billion. The results compare to the Thomson Reuters consensus estimates for a net loss of $0.25 and $3.2 billion in revenue.

Ron Johnson, JCPenney’s CEO, is not blinking though:

We have now completed the first six months of our transformation and while business continues to be softer than anticipated, we are confident the transformation of jcpenney is on track. The transition from a highly promotional business model to one based on everyday value will take time and we will stay the course.

The department store chain also punted on guidance:

The Company no longer anticipates achieving the previously issued non-GAAP earnings guidance for fiscal 2012. Management intends to continue to provide qualitative information on business trends and capital expenditures throughout the year.

The consensus estimate for the fiscal year ending in January had called for EPS of $0.96 on revenues of $15 billion. Given that total sales fell by nearly 23% in the second quarter and that online sales fell by almost 33%, there’s no chance — absolutely none — that those numbers are achievable.

When JCPenney’s reported poor first-quarter earnings, the company fired its president after only eight months on the job. CEO Johnson, credited with creating the retail stores at Apple Inc. (NASDAQ: AAPL), might start looking over his shoulder. His brave words aside, it makes little sense for JCPenney’s to keep following a strategy that is clearly not working.

JCPenney’s is losing its battle on two fronts. First, in its competition with other bricks-and-mortar retailers like Target Corp. (NYSE: TGT) and Kohl’s Corp. (NYSE: KSS), the company’s no-promotion strategy is by now a proven loser. Sale prices and gimmicks are what drive traffic and sales in retail. Second, its e-commerce business competes with Amazon.com Inc. (NASDAQ: AMZN) as well with its traditional competitors’ websites, and JCPenney’s is not making a compelling offer there either. For a primer on what investors can look forward to, see Best Buy Co. Inc. (NYSE: BBY).

JCPenney’s shares are down 9.5% in premarket trading, at $20.01. The current 52-week range is $19.06 to $43.18. Thomson Reuters had a consensus analyst price target of $27.31 before today’s results were announced.

Paul Ausick

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