1-800-Flowers.com misses Q2 expectations

Despite a profitable second quarter, 1-800-Flowers.com fell short of expectations.



The company reported a 1.1% revenue growth to $554.6 million for the quarter ending Jan. 1, from $548.4 million the previous year. The company credited its 1-800-Flowers.com and BloomNet segments for the increase, along with modest growth in its Gourmet Food and Gift Baskets segment, and e-commerce growth across the Harry & David, Cheryl’s, The Popcorn Factory and 1-800-Baskets brands, the company said.



For the quarter, 1-800-Flowers.com attracted 1.3 million new customers. Approximately 3.1 million customers placed orders during the quarter, and 58.4% were from repeat customers.



“This reflects the company’s effective marketing and merchandising programs, including initiatives in social and mobile communication channels and its ‘Celebrations’ suite of services — all designed to engage with its customers and deepen its relationships as their one-stop destination for all of their celebratory and gifting occasions,” the retailer said.



However, this modest growth didn’t help the company hit its goal for the quarter.



“During the fiscal second quarter, we achieved consolidated top- and bottom-line growth in what was a challenging consumer environment throughout much of the holiday season," said company CEO Chris McCann.



“Positive results were partially offset by slower overall growth at Harry & David, our largest brand in food gifting, which accounts for the majority of total revenues during the quarter,” McCann added. “While Harry & David grew revenues in its primary e-commerce channel, this was largely offset by lower year-over-year sales in its retail channel.”



Looking ahead, McCann anticipates accelerated revenue growth in the second half of fiscal 2017, which will be “dominated by our floral businesses where we are seeing a continuation of positive top and bottom-line trends,” McCann said.



“In addition, we see a number of tailwinds that will benefit revenue growth, including the better day placement of the Valentine holiday and growing everyday gifting in our Gourmet Food and Gift Baskets brands,” he added. “We believe this combination of factors will enable us to deliver solid top-line growth and strong bottom-line growth for the full fiscal year.”