The numbers: Bad. The department store chain reported that net income fell by 113% for a loss of $348 million. The company also reported a 16.6% decline in same store sales.
The takeaway: The market had been bracing for bad news given JC Penney’s preliminary results, which the company reported last week. Still, the profit loss was worse than expected. The results show the company is still struggling to recover from former CEO Ron Johnson’s failed attempts to turn it around with radical reforms, like eliminating discounts. When customers fled and sales tanked, JC Penney brought back Johnson’s predecessor, Mike Ullman, as CEO, borrowed heavily to stop the cash bleed and ran ads pleading for customers to return.
What’s interesting: When you hit rock bottom, things can only get better. The 16.6% drop in same store sales is an improvement from the 32% decrease the company reported last quarter. Only time will tell, but it’s possible the ugliest days for JC Penney are over. That doesn’t mean the company has turned around, but at least it isn’t getting worse.