Internet hardware and software retailer Egghead.com Inc posted better-than-expected fourth-quarter results as the company said it topped even its typically strongest holiday quarter. Net loss for the quarter was $12.8m, down from a loss of $35m in the year- ago quarter. On a per-share basis, the loss amounted to $0.50, beating the First Call consensus by $0.06.
Revenue dropped 43.3% to $42.3m year-over-year, as year-ago results include sales from the company’s retail stores, which have been closed since February 1998. Results for last year’s quarter also include a one-time restructuring charge of $19.5m stemming from the closures.
Online sales for the quarter, meanwhile, jumped to the aforementioned $42.3m from $26.6m last year, a 43.3% increase. Sales during the prior quarter were $41.9m. Egghead says it has now completed the year-long transition that has seen it become the first national US retailer to move its entire business from physical stores to the web.
The transition has come at a price, although the company feels the future prospects of e-commerce make the move well worth it. For the full fiscal year, losses totaled $34.4m, compared to $50.2m last year. Revenue for the year dropped 49.3% overall to $148.8m, while online revenue increased to that total from $59.7m last year.
One of the most significant measurements of the transition’s effectiveness is cost of sales however, which dropped 49.2% to $38m in the quarter, and fell 47.8% to $134.3m for the year. Looking ahead, the company warns that it doesn’t have high hopes for the current quarter, which is seasonally its slowest. Analysts are expecting a loss of $0.40.
