Why 1-800-Flowers.com Stock Withered Today

Actions of 1-800-Flowers.com (FLWS) fell today after the company posted a disappointing earnings report this morning. Shares fell 12.1% on the news.

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1-800-Flowers is short

The online florist missed the mark on the top and bottom rows of the report. Revenue fell 9.5% to $360.9 million, which was worse than the consensus estimate of $374.4 million.

The company focused on margin improvement, and gross margin increased 130 basis points to 38.4% due to lower freight costs, lower freight costs and logistics optimization efforts.

However, this was not enough to improve the bottom line, as adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) expanded from $6.6 million to $8.8 million.

Its adjusted loss of $0.34 per share widened from a loss of $0.28 per share in the year-ago quarter and was weaker than the consensus estimate of a loss per share of $0.26.

CEO Jim McCann acknowledged major challenges around consumer discretionary spending, but said the company was able to grow full-year EBITDA, improve its gifting platform and expand into new categories, including the acquisition of Scharffen Berger Chocolate Maker, a tall chocolate maker. final producer of artisanal chocolate.

What’s next for 1-800-Flowers?

Looking ahead, the company expects its challenges to continue next year, forecasting flat-to-low-single-digit revenue growth. It also sees adjusted EBITDA of $85 million to $95 million, compared to $93.1 million in fiscal 2024.

Given these trends and the challenges in the consumer environment, it’s clear why the stock is down today. Until the business returns to growth, the stock is best avoided.