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 Shares of the largest U.S. office supply retailer, which reported
better-than-expected results for the second quarter, rose slightly
in light trading before the bell.
The company has been spending heavily on advertising to promote
itself as a seller of products other than traditional office
supplies. It has also been investing to boost its online business.
Staples is facing increased competition from mass merchants such as
Wal-Mart Stores Inc <WMT.N> and online retailers such as Amazon.com
Inc <AMZN.O>, which offer cheaper products.
Staples said in March it would close 140 of its North America stores
this year to boost profits and focus on its online business.
The company said on Wednesday it closed 80 of these stores in the
second quarter ended Aug. 2.
Smaller rival Office Depot Inc <ODP.N> said in May that it would
close 400 U.S. stores by the end of 2016.
Staples forecast a profit of 34-39 cents per share for the third
quarter ending November.
Analysts on average were expecting 37 cents per share, according to
Thomson Reuters I/B/E/S.
Staples' net income fell 20 percent to $81.9 million, or 13 cents
per share, in the second quarter. Excluding items, the company
earned 12 cents per share.
Total sales fell 1.8 percent to $5.22 billion.
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Analysts on average had expected a profit of 11 cents per share and
revenue of $5.16 billion.
Staples' North America and online sales fell 6 percent to $2.3
billion.
The company's shares were trading at $11.80 before the bell.
Up to Tuesday's close of $11.62 on the Nasdaq, the stock had fallen
by more than a quarter this year.
(Reporting by Devika Krishna Kumar in Bangalore; Editing by Kirti
Pandey)
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