Bed Bath & Beyond Inc. (NASDAQ: BBBY) has to have a strong holiday sales season to hope to survive into 2023. The evidence is that will not happen. However, the retailer has appointed a new chief executive officer to captain what is likely to be a sinking ship.
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Sue Grove, the interim CEO, has decided to take the job permanently. She may find that permanently may be less than a year. She has worked in retail before, but even the CEO of Walmart could not fix Bed Bath & Beyond’s troubles.
The company has closed over 18% of its stores and laid off hundreds of people. Is it any wonder? The retailer’s financial results are in shambles. Revenue dropped 28% in the most recently reported quarter to $1.4 billion. This is a worse slide than the one at J.C. Penney before it disintegrated. Bed Bath & Beyond lost $366 million. The retailer said same-store sales would drop 20% for the fiscal year. Perhaps it will close enough stores to mitigate that.
Grove said at the time of the release, “Our results for the second quarter came in as previously expected and announced. While our sales and profit results do not yet reflect the strategic and financial actions we have initiated to change our performance, they do demonstrate sequential progress in several key areas.” If she calls this progress, what must a lack of progress look like?
The company’s stock has entered penny stock territory recently. It is down 65% this year to $5. Wall Street has completely abandoned the chances of a recovery.
Among Bed Bath & Beyond’s problems is its shrinking store count. While this may save a modest sum, for the time being, a smaller store count means some consumers will find it harder to find a store close to them. The inconvenience has helped ruin other retailers, like Sears and Kmart.
As Bed Bath & Beyond slides toward extinction, hopefully Grove will be paid well for the situation she has put herself in.
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