JCPenney warns: Losses are growing

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JCPenney warns: Losses are growing – Oct. 27, 2017

5 Stunning Stats About J.C. Penney

JCPenney says it will lose twice as much money as it had expected to this quarter.

The retailer now forecasts a loss of between 40 cents to 45 cents a share, more than twice as bad as both Wall Street estimates as well as the $62 million, or 20 cents a share, that it lost in the second quarter. The warning sent JCPenney (JCP) shares 14% lower Friday morning.

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Driving the bigger loss, the company said, is its decision to speed up the liquidation of poorly-selling inventory, primarily women’s clothing. CEO Marvin Ellison said the chain has already boosted sales but getting rid of less popular items.

Related: 2017 just set the all-time record for store closings

Penney has lost $242 million in the first six months of this fiscal year. And while it did manage to post a narrow $1 million profit last year, that came after a string of five straight losing years in which it lost a total of $3.5 billion.

The chain also closed 127 stores during the second quarter, more than 10% of its locations.

Of course JCPenney is hardly the only brick-and-mortar retailer that’s struggling. Store closing announcements have more than tripled this year, according to Fung Global Retail & Technology, a retail research firm. The total of 6,700 tops the previous record set in 2008, the first year of the Great Recession.

CNNMoney (New York) First published October 27, 2017: 12:06 PM ET

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