QVC’s Third-Quarter Revenue Up 3 Percent Due To Cooking, Beauty And Apparel Categories

QVC’s revenue increased 3 percent, to $1.2 billion, in the third quarter as a result of strength in cooking and dining, beauty, apparel and accessories products, partially offset by a decline in electronics.

The home shopping network’s parent, Liberty Interactive Corp., announced its third-quarter earnings Wednesday.

QVC’s average-selling-price-per-unit increased 1 percent, from $54.49 to $55.21, and units sold increased 1 percent compared to the prior-year third quarter.

Last week HSN reported that its third-quarter net sales jumped 5 percent, to $537.4 million.

QVC’s consolidated revenue, which includes its domestic and international shopping channels, increased 2 percent, to $1.9 billion.

“QVC delivered strong results in the third quarter, with eCommerce continuing its double digit growth — now accounting for 33 per cent of global revenue,” QVC President and CEO Mike George said in a canned statement. “With mobile commerce orders up 96 percent globally, we see these results as clear confirmation that our strategy to create a highly immersive digital shopping experience, with strong integration across TV, PC, tablet and mobile platforms, is not only succeeding, but significantly outpacing the industry.”

QVC’s U.S. revenue rose 3 percent overall due to a 14 percent increase in shipping and handling revenue due, in part, to a price increase implemented in the fourth quarter last year.

Mike George

Third-quarter returns as a percent of gross product revenue remained relatively flat. In the same period, eCommerce revenue increased 14 percent to $479 million and grew to 39 percent from 35 percent as a percentage of total U.S. revenue. Adjusted OIBDA increased 7 percent to $278 million and adjusted OIBDA margin(2) increased 81 basis points.

The increase in adjusted OIBDA margin was primarily due to an improved gross margin as a result of a favorable net shipping and handling position including warehouse productivity, as well as lower commissions, credit card and customer service expenses as a percentage of revenue.

“QVC continues to produce strong results, especially on a constant currency basis, despite a challenging macroeconomic environment, and we are pleased with the performance of our newest market, China,” Liberty President and CEO Greg Maffei said in his canned statement.

“We successfully completed the recapitalization of the company’s common stock into two tracking stocks, which increased shareholder value by $2.6 billion,” he said. “Our share repurchases were lower this quarter, as we were out of the market for six weeks due to the recapitalization. But, we remain committed to repurchases at the Liberty Interactive Group and the board of directors has increased our repurchase authorization by $1 billion.”

QVC’s international revenue slipped 1 percent in the third quarter to $681 million. The third-quarter results included the negative impact of the strengthening U.S. dollar against the Japanese yen, euro and U.K. pound sterling.


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