Office Depot Inc. (NASDAQ: ODP) shares took a dive on Thursday after the company issued a warning for its fiscal first-quarter earnings. The office supplies retailer announced preliminary estimated results for the first quarter, ended March 31, 2019.
For the quarter, Office Depot expects to report revenue of roughly $2.76 billion and adjusted operating income of about $65 million. Consensus estimates call for $0.11 per shares in earnings and $2.82 billion in revenue for the period.
The CompuCom division is expecting to report an operating loss of approximately $15 million in the first quarter of 2019, primarily driven by lower-than-expected revenue from existing customer projects compounded by less than commensurate reductions in associated expenses. Paper costs have increased over 20% during the past 12 months, and management is pursuing several initiatives to mitigate the impact of such cost increases going forward.
The Business Solutions Division is expecting to report operating income of roughly $46 million in the first quarter of 2019. This performance was impacted by paper and paper-related costs increases that could not be completely passed through to customers due to the timing of contractual limitations.
Lastly, the Retail division is expecting to report operating income of $66 million.
https://247wallst.com/retail/2019/04/04 ... s-warning/