Radio Shack Closings: 1,100 Stores Will Shut Doors as Company Falters

Tuesday, 04 Mar 2014 04:47 PM

By Clyde Hughes

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As many as 1,100 Radio Shack stores are closing, according to an announcement Tuesday by the Fort Worth, Texas-based company.

The company will have 4,000 stores in the United States after the closings, Radio Shack CEO Joseph Magnacca told The Associated Press. He did not say where or when the closures will happen or the number of jobs lost.

Radio Shack has 27,500 employees globally and the number of locations still tops closest electronics competitor BestBuy, which has 1,400 locations.

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"Our fourth quarter financial results were driven by a holiday season characterized by lower store traffic, intense promotional activity particularly in consumer electronics, a very soft mobility marketplace and a few operational issues," Magnacca said in a news release Tuesday, explaining Radio Shack's poor holiday season.

"Even in this environment, we're continuing to make progress on the five pillars of our turnaround plan: repositioning the brand, revamping the product assortment, reinvigorating the stores, operational efficiency, and financial flexibility," Magnacca continued.

Radio Shack said in the news release that sales were down 19 percent in the fourth quarter, $935.4 million from $1.17 billion in the previous fourth quarter.

For the entire fiscal year, sales fell 8.8 percent to $3.43 billion, compared to $3.83 billion the year before.

"Our brand equity remains strong, reflected in the sales growth we're seeing in our new Concept Stores which redefine the Radio Shack store experience," Magnacca said in his statement. "We have also been encouraged by the positive response to our new brand positioning around 'Do It Together,' which we kicked off with our award-winning Super Bowl commercial."

Radio Shack sales initially jumped 4.58 percent after the company made fun of itself in its 1980s-themed Super Bowl ad, which promised updated and more modern stores.

"We’re using the Super Bowl as the platform to get people to rethink Radio Shack," Jennifer Warren, the company's chief marketing officer, told Forbes at the time. "This ad is meant to grab attention, make viewers laugh, and let people know, it’s out with the old and in with the new RadioShack."

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