Staples disappoints with lackluster guidance
The office supply giant couldn't meet Wall Street expectations on revenue in its third quarter.
The Framingham, Mass. company said net income for the third quarter increased 13% to $326 million, or 47 cents a share, up from $288.7 million, or 40 cents. Revenue rose to $6.57 billion, below the $6.71 billion Wall Street expected amid weakness in its international business.
Staples also gave lackluster guidance. The company forecast flat to low single-digit sales
growth in the current quarter on earnings of between 39 cents to 43 cents. That's below Wall Street expectations of earnings of 43 cents on revenue of $6.59 billion.
For the full year 2011, the company sees a sales increase in the low single-digits on earnings of $1.38 to $1.42 per share, down from an earlier forecast of $1.39 to $1.45 per share.
Shareholders, which have seen the stock price tumble nearly 40% this year, did get a break of sorts. The company will repurchase approximately $600 million of its stock, up from earlier guidance of $300 million to $500 million.
This results come less than six months after Staples shares had their biggest fall in 11 years after the company slashed its full-year profit outlook and adopted what it called “more conservative" earnings guidance.
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The offering could become the second-biggest this year if underwriters exercise an option to buy more shares.
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