Shares of Bed Bath & Beyond (BBBY) - Get Bed Bath & Beyond Inc. Report were falling more than 5% after hours Wednesday despite reporting fourth quarter earnings results that exceeded analyst expectations.
The Union, NJ-based company reported fourth quarter earnings of $1.20 per share on revenue of $3.31 billion. Wall Street was expecting the company to earn $1.12 per share on revenue of $3.33 billion.
"During the fourth quarter and throughout fiscal 2018, we have been driving significant foundational change across our business," said Steven Temares, the company's CEO, in a press release. "The pace of our transformation accelerated during fiscal 2018."
The company now expects fiscal 2019 earnings between $2.11 and $2.20 per share, excluding certain charges. Analysts polled by FactSet expected the company to earn $1.80 per share in the fiscal year.
Shares of Bed Bath & Beyond are up almost 71% so far this year amid a push from three activist firms -- Legion Partners, Macellum and Acora Advisors -- to improve the company's results. The firms are proposing to nominate 16 candidates to replace the company's current board.
Bed Bath & Beyond announced in its earnings report that its board of directors is undertaking a comprehensive review of its "composition, governance structure and compensation practices." The company is also accelerating its board refreshment program, which has already resulted in in the addition of three new directors over the past two years.
"Our strategy, business transformation and execution are a critical component of our future success, and we also recognize that the right Board governance structure and incentives are necessary to ensure that we achieve our objectives," said Patrick Gaston, Lead Independent Director of Bed Bath & Beyond. "The Board is committed to acting in the best interest of our shareholders, is working hard to accelerate the rate of change in the Company's governance, greatly appreciates investor input received to date, and looks forward to continued constructive engagement with our shareholders on these and related efforts."