A few weeks after consumers finished unwrapping presents, a wave of retailers are gifting Wall Street with lumps of coal.
On Monday, Lululemon Athletica and Express became the latest retailers to warn investors of disappointing earnings in the holiday quarter. These negative forecasts follow similar warnings last week from a range of retail companies, including American Eagle Outfitters and Zumiez. In response, Lululemon stock shed 16 percent and Express shares dropped about 2.5 percent.
In a release Monday, Lululemon's CFO said the company had seen "traffic and sales trends decelerate meaningfully" since the beginning of January. Because of that, its net revenue forecast and revised its fourth-quarter guidance from flat same-store sales to a decline in the low-to-mid-single digits.
Meanwhile, the CEO of Express said the specialty retailer had "a drop in traffic that was even deeper than anticipated as consumers waited until much closer to Christmas to shop." To draw them, Express extended and deepened discounts—a promotional environment it expects to maintain amid what it sees as "weak" January traffic.
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Shares of The Bon-Ton Stores were also sharply lower Monday. The department store chain said Friday that adverse weather hit same-store sales during the holiday quarter.
Worst season since 2008
The 2013 holiday season was six days shorter than that of 2012, and the compressed period affected sales as retailers tried to adjust with earlier Black Friday and Thanksgiving sales, said Richard Jaffe, an analyst at Stifel Nicolaus.
Unlike past years, however, in-store Black Friday weekend sales fell compared with the previous year, according to ShopperTrak.
