Disappointing quarterly results from RadioShack (NYSE: RSH) on Monday put a damper on exchange traded funds (ETFs) that invest in retail stocks.
RadioShack shares were off 2% in premarket trade Monday after the company said its first-quarter profit fell 30%.
“Despite a challenging economy and tough weather conditions, our first-quarter results were generally in line with our internal expectations,” said Chief Financial Officer Jim Gooch in RadioShack’s earnings release. “We expect the softness in our business to continue during the second quarter before we begin to see the benefits of our merchandising and sales initiatives improving both revenue and income trends in the back half of the year.”
RadioShack cut the high end of its 2011 full-year profit outlook. The company on Monday said it informed T-Mobile in February that it had materially breached its contract with RadioShack.
“RadioShack continues to work closely with T-Mobile to resolve the breaches; discussions are constructive and RadioShack expects the matter to be resolved,” the electronics retailer said.
SPDR S&P Retail ETF (NYSEArca: XRT) was up 9.3% year to date through April 21, according to Morningstar, edging ahead of the S&P 500.
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