“QVC’s performance was driven by another strong quarter of eCommerce and mobile purchasing, a trend that continues to accelerate across our global markets,” said QVC President and CEO, Mike George. “Our customers are embracing QVC’s unique digital shopping experience, fueled by great values on distinctive products across each of our growing platforms.”
QVC's U.S. revenue increased 4% to $1.3 billion in the second quarter, while gross product revenue increased 5% as a result of strength in beauty, electronics and apparel products. This was reduced to a 4% increase overall due to an increase in second quarter returns as a percent of gross product revenue of 117 basis points primarily due to increased return rates in apparel, health, beauty and jewelry due to the mix of products within those categories. Average selling price ("ASP") increased 5% from $52.02 to $54.84, while units sold remained flat compared to the prior year second quarter. In the same period, eCommerce revenue increased 15% to $498 million and grew to 39% from 35% as a percentage of total U.S. revenue. Adjusted OIBDA increased 3% to $315 million, with adjusted OIBDA margin (2) decreasing slightly due to lower product margins.
QVC's international revenue increased 4% in the second quarter to $694 million. The second quarter results included the negative impact of the strengthening of the U.S. Dollar against the Euro and U.K. Pound Sterling that was somewhat offset by the positive impact of the weakening of the U.S. Dollar against the Japanese Yen. International adjusted OIBDA increased 9% to $123 million and adjusted OIBDA margin increased 76 basis points in the second quarter.
QVC Japan's revenue grew 13% in local currency in the second quarter primarily due to increased sales in home and apparel as well as the earthquake and related events experienced last March. QVC Japan's ASP in local currency increased 3% and units shipped increased 12% in the second quarter. QVC Japan's second quarter returns as a percent of gross product revenue in local currency increased by 144 basis points primarily due to higher return rates in apparel, jewelry and home due to the mix of products within those categories. QVC Japan's adjusted OIBDA in local currency increased 16% and adjusted OIBDA margin increased 65 basis points in the second quarter. The increase in adjusted OIBDA margin was due primarily to lower commissions expense as a result of contract renegotiations and fixed commission fee revenue leverage as well as a higher absorption of warehouse and call center costs due to increased revenue. Product margins also increased primarily due to higher product margins in the beauty category.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV