Against that backdrop, the latest quarterly earnings results from Bed Bath & Beyond Inc. stand out, because they show the long-suffering home goods chain to be in comeback mode.
Bed Bath & Beyond, which also owns stores such as Buybuy Baby and World Market, reported on Thursday that comparable sales rose 6% in the three months ended in August from a year earlier, its first gain on that measure since the end of 2016. Executives said on a conference call that the trend continued into September, suggesting the company is sustaining momentum as the crucial holiday season approaches. Despite recording a 89% increase in digital sales — which can crimp profitability because of shipping costs — the retailer managed to deliver a higher adjusted gross margin than a year ago. The improvements sent shares soaring more than 30% on Thursday morning.
Bed Bath & Beyond is certainly benefitting from factors beyond its control. The pandemic has made people spend more time at home, and that has encouraged them to splurge on decorating projects and cookware. It’s also likely helped that, amid lingering safety concerns about going to brick-and-mortar stores, some of the company’s key competitors, the TJX Cos.-owned HomeGoods and HomeSense, do not offer e-commerce.
But it’s more than that. CEO Mark Tritton, who has been in the job less than a year, appears to be succeeding at cleaning up the mess it took his predecessor, Steven Temares, well over a decade to make. Tritton has overhauled the C-suite, appointing new leaders for everything from merchandising to technology to supply chain. He has begun closing underperforming stores and modernizing its online offering. That showed in how quickly he moved to roll out in-store and curbside pickup of online orders — something the retailer should’ve been doing anyway — in the