RadioShack announced plans to close up to 1100 underperforming stores in the U.S. at its fourth quarter earnings report Tuesday.
The electronics retailer reported a decline in net sales and same store sales, prompting a 15 percent drop in the company’s shares to $2.29.
“Over the past few months, we have undertaken a comprehensive review of our portfolio from many angles–location, area demographics, lease life and financial performance–in order to consolidate our store base into fewer locations while maintaining a strong presence in each market. The result of that review is our plan to close up to 1100 underperforming stores. We will continue to have a strong, unmatched presence across the U.S. with over 4,000 stores including over 900 dealer franchise locations,” says Joseph C. Magnacca, chief executive officer, RadioShack.
Magnacca sited lower store traffic, intense promotional activity, a soft mobility marketplace and operational issues as the reasons for the shortfall, but pointed to the initial success of the brand’s new concept stores, which reported Q4 sales growth.