Shares of Bed Bath & Beyond (NASDAQ:BBBY) were being slammed by roughly 15% at midday Thursday thanks to a gloomy second-quarter outlook announced Wednesday after the bell.
For the first quarter, BBBY saw profits increase 15%, coming in at $206.8 million or 89 cents per share — more than the 84 cents per share expected by Thomson Reuters analysts. Revenue also met expectations, increasing to $2.22 billion from $2.11 billion at the same time last year.
However, the company’s better-than-expected first quarter was all but forgotten in the wake of the lackluster guidance.
Bed Bath & Beyond said it expects just 97 cents to $1.03 per share for the upcoming quarter, which falls short of current analyst predictions of $1.08 — and BBBY said that number could go lower depending on whether BBBY closes on its acquisition of Cost Plus (NASDAQ:CPWM) as expected. And for the full year, the company’s projections of single- or low-double-digit growth disappointed analysts, who expected roughly 14%.
However, the Cost Plus deal is expected to turn things around for the second half of the year and help Bed Bath & Beyond compete with online retailing giant Amazon (NASDAQ:AMZN), which launched its own home goods site earlier this year.