Alan Wolf On Jan 21 2013 - 1:00am

Holiday Sales Tepid For CE Retailers

NEW YORK — CE retailers reported a mixed December as a last-minute sales surge couldn’t compensate for post-Thanksgiving sluggishness in the first part of the month.

“Strong results late in the month did not completely offset softness in the first three weeks,” said Target chairman, president and CEO Gregg Steinhafel. Net December sales rose a scant 0.8 percent for the No. 2 discount chain, to $10.2 billion, and comp-store sales were essentially flat. Comp sales in hardlines, which includes home entertainment, declined by the midsingle digits.

Despite the tepid results, Steinhafel said Target’s profitability benefitted from an “appropriate balance” between promotions and sales, combined with “thoughtful” inventory management.

Net and comp sales for the quarter to date, ended Dec. 29, were essentially flat, while year-to-date net sales were up 3.3 percent to nearly $66 billion and comps increased 2.7 percent.

The chain is projecting a low single-digit increase in January comps.

Business was markedly more robust at Costco, where total December sales rose 12 percent, to $11.2 billion, and U.S. comps rose 8 percent, although an extra day in the reporting period gave both results a 2 percent boost. The wholesale club cited CE as one of the better-performing categories within hardlines, whose comps increased by the mid- to high-single digits.

Elsewhere, Barnes & Noble said holiday sales within its Nook segment, which includes devices, content and accessories, fell 12.6 percent to $311 million for the nine weeks, ended Dec. 29, on a decline in unit sales and the average selling price of its proprietary e-reader.

Barnes & Noble had reported that e-reader sales doubled over Black Friday weekend, noted Credit Suisse retail analyst Gary Balter, suggesting that demand for the device fell sharply during the remainder of the holiday period despite the launches of Nook HD and HD+ and the expansion of Nook distribution to Walmart and Target.

“Nook device sales got off to a good start over the Black Friday period, but then fell short of expectations for the balance of holiday,” said Barnes & Noble CEO William Lynch. “We are examining the root cause of the December shortfall in sales, and will adjust our strategies accordingly going forward.”

The company said its digital strategy “will continue to center around delivering the best digital reading, shopping and content experience in the market, while also being diligent about calibrating expenses to business trends in order to scale the business to profitability over time.”