1-800-FLOWERS.COM Sees Significant Stock Drop After Earnings Report
1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS) is experiencing a notable decline in its stock price, dropping 19.6% in premarket trading following the release of its Fiscal 2025 second quarter earnings report. The stock, which is now down by $1.73, is garnering attention as investors digest the company's financial performance and outlook.
In the second quarter ended December 29, 2024, 1-800-FLOWERS reported total revenues of $775.5 million, a decrease of 5.7% compared to the same quarter last year. The decline was attributed to a highly promotional consumer environment and a pullback in corporate gifting orders, which significantly pressured overall sales.
Jim McCann, the Chairman and CEO of 1-800-FLOWERS, remarked, "Our second quarter revenue declined 5.7%, showing year-over-year improvement, but not at the pace that we had been anticipating." He further noted that issues with the implementation of a new order management system also negatively impacted revenue, potentially costing the company around $20 million.
The company reported net income of $64.3 million, or $1.00 per diluted share, which, although an increase from the previous year’s $62.9 million, failed to meet the expectations of many investors. Adjusted EBITDA for the quarter also fell to $116.3 million compared to $130.1 million in the prior year.
As a response to these challenges, 1-800-FLOWERS is focusing on enhancing its operational efficiencies through its 'Work Smarter' initiatives. The company is shifting resources to better adapt to the changing consumer demands and is optimistic about leveraging new technologies for increased customer engagement.
On the outlook for the fiscal year, 1-800-FLOWERS amended its expectations, suggesting a continued decline in revenue, projected to decrease in the mid-single digits on a percentage basis. This conservative guidance is likely contributing to the ongoing investor concern, ultimately reflecting in the stock's steep decline.
Investors looking to understand the shifting dynamics of 1-800-FLOWERS should pay close attention to upcoming performance metrics and the company’s ability to implement its strategic initiatives moving forward.
