issued a dire fourth-quarter profit warning Monday that sent its shares down more than 11% in premarket trading.
The gadget chain forecast fourth-quarter earnings at 94 cents to 99 cents a share on overall sales that are up 7% to 9% from last year. The company, which left intact its prediction of a same-store sales decline in the midsingle digits, had previously predicted a top-line gain of 15% to 18% in the period.
Analysts surveyed by Thomson First Call were forecasting earnings of $1.31 a share in the quarter.
"Our product assortment was well received by shoppers, and our inventory position improved in December as expected," Sharper Image said. "But our in-stock position in some key holiday items was still less than optimal. As a result, we lost some potential sales gains.
"Additionally, store traffic was lighter than we had anticipated, particularly in the 10 days leading up to Christmas Day. We also saw softer Internet sales and a lower-than-expected response to our holiday catalogs and direct-response advertising," the company said.
The stock was recently down $2.69, or 11.7%, to $20.45 on Instinet.