Despite showing record revenue for the third quarter, gadgets marketer Sharper Image posted a net loss, which it blamed on the West Coast port slowdown.
The San Francisco-based cataloger/retailer lost $3.3 million for the quarter ended Oct. 31, compared with last year’s net earnings gain of $1.0 million. Sharper Image says that its merchandise gross margin were lower because of higher air freight expenses incurred to bypass the port slowdown still affecting the West Coast.
“We posted record revenues in the third quarter, in spite of less-than-desired inventory levels caused by slow processing of merchandise going through West Coast ports,” said founder/chairman/CEO Richard Thalheimer in a company statement “Additionally, our merchandise gross margin was lower than planned because of a variety of factors, including higher air freight expense incurred to bypass the West Coast port slowdown; increased promotions and sales incentives; and markdowns of seasonal merchandise.”
Sharper Image’s total revenue increased 20% to $153.6 million from last year’s third quarter of $128.1 million. Total catalog/direct marketing sales, which include wholesale, increased 28% to $48.8 million from last year’s $38.3 million. Internet sales increased 24% to $21.0 million from last year’s third quarter Internet sales of $17.0 million. Total store sales increased 15 % to $80.1 million from last year’s third quarter of $69.6 million.