Market Minute: J.C. Penney's Post-Ron Johnson Earnings Confirm Grim Warning

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Two big name companies have fallen on hard times, and the numbers tell the story.

The Dow Industrials fell 42 points yesterday, the S&P 500 lost 8, and the Nasdaq fell 6.

JCPenney
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J.C. Penney (JCP) had warned that its quarterly results would be weak. They were, and then some. The retailer posted a loss of $348 million, more than double the deficit of a year ago. And sales tumbled 16 percent. The company blames the failed policies of ousted CEO Ron Johnson. It is now in the process of returning to its prior use of sales and discounts. Penney shares have lost 30 percent over the past year.

Dell's (DELL) net tumbled 79 percent, falling short of Wall Street's already lowered expectations. It's the company's sixth straight decline in quarterly earnings, as the PC market continues to suffer due to the growing popularity of smartphones and tablets. Company founder Michael Dell is trying to take the company private in a deal valued at more than $24 billion.

Two other tech companies, Autodesk (ADSK) and Aruba Networks (ARUN), are set to slide after posting disappointing results. Autodesk also forecast results for the current quarter that are below Street estimates.

Home furnishings retailer Tuesday Morning (TUES) fired its chief executive nearly a year ago. Now she's suing the company, claiming discrimination after being diagnosed with breast cancer. Tuesday Morning says the charge is without merit.

And tomorrow is the one-year anniversary of Facebook's (FB) IPO. It was marred by a major technical glitch at the Nasdaq, and a quick drop in price. Shares were listed at $38; they closed yesterday at about $26.

Also tomorrow, diehard gamers will get their first look at Microsoft's (MSFT) new Xbox video game system. According to NPD, videogame sales tumbled 25 percent last month.

-Produced by Drew Trachtenberg



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23 Comments

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sgoold

They have ruined a staple store. I grew up with JCP and counted on their products. Then they turned greedy. I hope all on the board loose their collective butts.

May 30 2013 at 11:02 PM Report abuse rate up rate down Reply
DNor81562

the prices are going up - they said so they could put them "on sale" at regular
prices. week by week you can see the prices rising.

May 30 2013 at 8:46 AM Report abuse rate up rate down Reply
msmcompel

JCP used to have beautiful bedding, bath rugs, drapes, & carpets. now, they offer cheap quality in those products, so i rarely shop there anymore.

May 26 2013 at 11:16 PM Report abuse rate up rate down Reply
knotaguru

Another sign of mismanagement by the jcp people beside those listed in previous comments is their lack of inventory online. Any time I have tried to buy something from them in the past year or so, nine times out of ten I will get a message that the item is out of stock or no longer available. Not exactly a good way of keeping sales coming in.

May 25 2013 at 8:38 AM Report abuse +1 rate up rate down Reply
lauren.green4

I can't understand why the Ron Johnson guy decided to cheapen the quality of the clothes! Matter of fact, he took out all of the good clothes and brought in all this super trendy stuff that no one can wear to work!

Except for the coats, I stopped liking the St.John's Bay line. Over a decade ago, St. John's Bay was much better. Then came the huge decline in the quality of this brand. The fabrics wore out and faded very fast. I could only get a few wears out of the St. John's Bay tops, so I stopped buying from that brand altogether. If they brought St. John's Bay back, they would have to take it back to the 1990's quality. That's not going happen. They have no money left for good material.

May 18 2013 at 10:27 PM Report abuse +1 rate up rate down Reply
sixtymgqd

I'll go back to jcp when they put St. John's Bay twill pants back on online catalog! The ORIGINAL pant, not the new cheap makeover. PLEASE! Ladies, do you remember them? If so, let jcp know. By the way, just a little marketing tidbit, why would you go from all caps (JCP) to lower case (jcp)? You demoted your selves.

May 17 2013 at 12:48 PM Report abuse rate up rate down Reply
1 reply to sixtymgqd's comment
Lorie

I remember them. The problem is most companies are trying to cut corners, including jcp. We customers are not stupid.
Unfortunately, I tried to contact them directly last week, when I had a problem. They do not list a direct contact email address. Guess they are afraid to hear from the general public, .their customers. If not in touch with who they are trying to serve...then.........good bye.

May 17 2013 at 4:02 PM Report abuse +1 rate up rate down Reply
Lorie

This is a comment just made by my husband. "Corporate thinks they know what their customers need and want. They know best and will continue to do what they are doing until the customers get it....they know ".

May 17 2013 at 12:10 PM Report abuse rate up rate down Reply
Lorie

TO THE ADVERTISING DEPARTMENT!!!!!! if you are monitoring these comments. Pull your current ad on TV. You made a mistake...move on. The late night hosts are having a field day, at your expense. You have become a joke. Penny's in the past had class. The ad you are running is far from it. Pay attention to what we are saying and quietly take care of business and do what you need to do to correct it. If you pay attention your customers will return. Other wise we will be sad in the lose of another place to shop.

May 17 2013 at 11:28 AM Report abuse rate up rate down Reply
pineway259

I wonder if JC Penny has the same BOD that Eastman Kodak has. How two huge companies can go down the drain is such a short time run by supposedly "talented" people is amazing. Just who is minding the store anymore and how do these incompetents get into power unless they are members of the Obama regime.

May 17 2013 at 11:00 AM Report abuse -1 rate up rate down Reply
2 replies to pineway259's comment
Lorie

Eastman Kodak did not pay attention to what was going on around them and did not keep up with technology. They had done things the same way for so long that they thought they knew what was best and they lost. With Penny's they are not listening to their customers. This is a society of people who have been conditioned to 'Sales'. Take that away and their consumer base leaves to find a better deal. Government might play a little part...but in this case I don't think so. It is someone who came up with an idea and it didn't work. They got the message on that one...but are not paying attention to the whole picture. It's too bad, because I personally have shopped at Penny's for a lot of years. Hope they wake up before it's too late.

May 17 2013 at 11:15 AM Report abuse +1 rate up rate down Reply
marysheepdog70

Seriously? You are going to blame this on the President? That's laughable.

May 17 2013 at 11:44 AM Report abuse rate up rate down Reply
Lorie

JC Penny needs to get a clue or,they will go out of business. I went to our local store to find a simple sweater. I didn't know where to look so,asked a clerk. She told me that they are on the back wall or over here or over there, that they are scatteres through out the atore. i looked and didn't find what I was looking for. The clerk became irritated, and got an edge to her voice. Never did find what I was looking for. The point is, when I shop for,a certain item, I don't want to have to go on a treasure hunt. My husband experienced the same thing in the men's clothing department. Put like kind things together. They think if they spread things though out the store, we will take time to find what we are looking for. I don't have the time to do so, and will go else where. Guess they learned about their recent campaign to keep the same price every day. Didn't work did it! Now they have brought back 'Sales'. Until they revamp their store...so it is shopper friendly, I will not return. I mentioned this to several others in a conversation and they have had the same problem. The lack of sales is telling you something, unless they listen they will be gone. The general feeling is they would rather shop at Wal Mart than go to a store that just dosen't care...this includes some of their sales personnel.

May 17 2013 at 10:48 AM Report abuse rate up rate down Reply