Home holds its ground as Q2 sales shrink at QVC/HSN & Cornerstone
Summary:
- Home sales fell across QVC Group‘s two U.S. retail units in the second quarter, yet the category continued to account for the largest share of total sales at both.
- The declines came as QVC Group’s overall consolidated revenue also dropped for the quarter and first half.
- The company’s net loss narrowed considerably from the prior-year period as it works toward exiting bankruptcy.
WEST CHESTER, Pa. – QVC Group reported a significantly narrower net loss for the second quarter and first half of the fiscal year, even as revenue continued to decline.
As the company prepares to emerge from bankruptcy, its new Q2 filing with the SEC shows that home remained the top-selling category for both its QVC U.S./HSN division and the Cornerstone Brand group, which specializes in home and apparel.
At QVC/HSN (which the company reports as QxH) home sales dropped11.2% to $468 million during the quarter ended June 30. Home remained the division’s largest product category, accounting for 38.5% of sales. The QxH division’s total sales fell 12.6% to $1.2 billion.
For the six-month period, QxH home sales declined 9.4% to $965 million and accounted for 39.4% of total sales. The QxH division’s total sales fell 11.3% to $2.4 billion.
Revenue declines were slightly less steep in the Cornerstone Brands division, which includes the Ballard Designs, Frontgate, Garden Hill and Grandin Road retail brands.
Second quarter home sales decreased 7.9% to $197 million and comprised 85% of total sales. Total Cornerstone sales were down 7.5%to $233 million.
First half home sales fell 8.0% to $344 million from $374 million and made up 82% of Cornerstone’s sales. Total division sales fell 6.9% to $421 million.
Consolidated revenue for QVC Group, which includes the QVC International business, fell 10.6% to $1.998 billion during the quarter. Net loss shrank to $30 million compared to a net loss of $2.2 billion in the year-ago period.
For the six-month period, consolidated revenue fell 8.9% to $3.96 billion. Net loss pared down to $70 million compared to a net loss of $2.3 billion.
QVC Group ended the quarter with cash and cash equivalents of $1.37 billion compared to $1.97 billion in the year-ago period.
The filing offered little color on segment performance, which is common while companies are operating in Chapter 11. But QVC Group to a step closer to coming out of bankruptcy on July 20 after the bankruptcy court approved its prepackaged financial restructuring plan.
Since it filed for bankruptcy in April, QVC Group has slashed its debt from $6.6 billion to $1.325 billion. Last month, the company reiterated that all vendors will have their claims paid in full or reinstated after it exits bankruptcy.
See also: QVC owes more than $93 million to top unsecured creditors
The reorganized company will operate with a new $600 million line of credit and plans to build on its WIN growth strategy – a three-year transformation plan launched in late 2024 to reposition QVC Group as a cross-platform, live social shopping ecosystem.
