(Analyst commentary added to update.)



) -- While Talbots posted a loss in its second-quarter, results were better than expected, signaling that turnaround efforts are beginning to pay off.

In the just-ended quarter, the company recorded a loss of $24.5 million, or 45 cents a share, compared with a loss of $25 million, or 47 cents a share, in the year-ago period.

Excluding charges, the company lost 33 cents a share, better than the 55-cent deficit analysts expected.

Sales tanked 23% to $304.6 million from $395.2 million, while same-store sales plunged 24.9%.

"Customers seem to be responding positively to new product, and we agree

it has looked much better," UBS analyst Roxanne Meyer wrote in a note on Wednesday.

Talbots has been cutting costs and revamping its merchandise in an effort to offset declining sales -- and it has a big hole to dig itself out of. The company still expects to see its bottom line in the red in the third quarter, with a loss between 24 cents and 30 cents a share.

Meyer says this guidance is a bit conservative, as the Street forecasts a loss of 31 cents.

And while third-quarter sales decline is expected to moderate -- declining between 14% and 17% -- it's still lagging other boomers.

Last month, a majority of

women's retailers also reported losses

in their second quarter.

New York & Company



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all swung to losses, but topped analysts' forecasts.

Chico's FAS

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were the only women's retailers in the black for the quarter.

-- Reported by Jeanine Poggi in New York

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