It was a summer of shopping for the home, from the home.
Bed Bath & Beyond Inc.
posted its first comparable-sales growth since 2016 in the latest quarter, with the company’s digital sales surging 89% as people shopped for home goods online during the coronavirus pandemic.
Comparable in-store sales retreated in the company’s fiscal second quarter compared with last year, dipping by roughly 12%. But customers converged on the Union, N.J.-based retailer’s curbside and in-store pickup options, helping drive the acceleration of its internet sales. Companywide comparable sales grew 6%, Bed Bath & Beyond said.
Shares climbed roughly 26% to $18.91 Thursday morning. Through Wednesday, the stock had been down about 13% year to date.
Companies that sell home goods and home-improvement products went on a tear over the summer as people who were spending more time in their houses during the coronavirus pandemic shopped with a focus on the home.
Home Depot Inc.
achieved revenue growth of 23% in the May-to-July period, while
posted e-commerce sales growth of 97% in the quarter that ended in July.
Overall, Bed Bath & Beyond’s second-quarter revenue ticked down to $2.69 billion, from $2.72 billion in the year-ago period. The company posted an adjusted profit of 50 cents a share, beating the FactSet analyst consensus forecast for a loss of 30 cents a share.
The retailer’s summertime success included strong sales of products aimed at the off-to-college set. Despite the prospect of disruptions to on-campus learning during the pandemic, back-to-college sales grew by 21% from May to September as the company leaned into promotions and marketing efforts to draw in students and their families.
More than 500,000 people signed up for a discount pass pitched to college students, driving more than 400,000 transactions, Cindy Davis, the company’s chief brand officer, told analysts on a call Thursday morning. She added that the company believes back-to-college shopping may extend later into the year than usual as some students face a delayed start due to the pandemic.
Overall, digital sales represented about 32% of Bed Bath & Beyond’s total sales by the end of the quarter, Chief Executive Mark Tritton said. In-store and curbside pickup options now make up over 15% of digital sales, he said. Including ship-from-store capabilities, stores fulfilled about 36% of the companies’ digital orders in the second quarter.
A growing share of store-pickup transactions in the company’s digital sales mix is favorable, Mr. Tritton said, because those transactions have a profit margin that is similar to traditional in-store sales.
Write to Matt Grossman at [email protected]
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