The struggling electronics retailer reported a wider-than-expected quarterly loss Tuesday that CEO Joseph C. Magnacca laid squarely on handset makers like Apple (AAPL). In a release, Magnacca said that customers just aren't coming into electronics stores because of "lackluster" interest in the "current handset assortment."
In the past quarter, RadioShack deeply discounted Apple's iPhone 5C and 5s to try to lure customers.
Both stores to have the biggest discounts on iPhone were RadioShack and best buy, both companies are struggling to get customers in stores ? JG (@cashowtime) Jan. 7 at 09:01 AMBut the 5c and 5s phones weren't exciting enough -- even at the cheap prices -- to bring shoppers into the Shack. Comparable store sales fell 14% "driven by traffic declines and soft performance in the mobility business." The company revealed a quarterly operating loss Tuesday of $98.3 million, or $0.97-per-share. That amount was four times the operating loss for the same period last year. The stock fell nearly 10% on the news to below $1.40. RadioShack has credit that it can tap to stay afloat for a time. It has $423.7 million in "total liquidity," according to its earnings report. About $61.8 million of that is in cash and cash equivalents. It also has $361.9 million under a 2018 credit agreement. A majority of investors on StockTwits are confident that management will right the Shack before burning through loans. Sentiment on the stock is 72% bullish, according to StockTwits' analytics.
They have plenty of cash available 400k + from 10k they will use revolving cash too. No bankruptcy coming @Aventador ? Marc (@Crammarc22) Jun. 10 at 11:18 AMBut many others maintain that RadioShack is out of time. And the company can't wait for a new iPhone to debut in the fall and bring in throngs of customers. Creditors, they say, won't let the company keep burning through loans and have been at odds with aspects to management's turnaround effort. Creditors blocked a plan earlier in the year to close 1,100 stores.
$rsh 10q shows 5/3/14- $61 mil cash on hand_Burn @ $1 mil day_RSH is out of cash by 7/4_They cannot operate on pure credit_read loan terms ? Aventador (@Aventador) Jun. 10 at 11:29 AMAt the time of publication, the author held no positions in any of the stocks mentioned. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.