Staples Revenue Falls 4%, Hurt by Same-Store Sales

Staples Inc. said profit and revenue fell in the third quarter, hurt by lagging same-store sales as it works through its turnaround plan.

Staples' performance has been challenged recently as an increasingly digital workplace continues to drag on sales. Sales at existing stores fell 4% in the quarter, compared with a 3.6% decline analysts polled by Consensus Metrix expected. Comparable sales, which includes stores and Staples.com but excludes currency impacts, declined 3%.

The company closed 16 stores during the third quarter—35 stores year to date—in North America as part of a plan to close at least 50 stores this year.

In February 2015, Staples agreed to buy Office Depot for about $6.3 billion. The U.S. Federal Trade Commission argued the tie-up would mean higher prices and fewer options for big companies that buy office supplies in bulk, and a federal judge in May blocked the deal.

Chief Executive Shira Goodman has said the company is in the middle of "dramatically changing our mind-set and operating model" to reposition the company after the Office Depot deal was blocked.

Investment firm Hilco Capital Ltd. said Thursday it bought Staples retail business in the U.K., which Staples said it sold for "nominal proceeds." The company previously said it would explore strategic alternatives for its European operations.

In all for the October quarter, Staples posted a profit of $179 million, or 27 cents a share, compared with $198 million, or 31 cents a share, a year earlier. Excluding items, earnings were 34 cents a share, in-line with the company's guidance for earnings between 32 cents and 35 cents.

Revenue slipped to $5.36 billion from $5.59 billion a year ago. Excluding the impact of store closures, foreign exchange effects and the sale of Staples print solutions, the company said revenue slipped 2%. Analysts projected revenue of $5.4 billion.

For the current quarter, Staples expects adjusted earnings of 23 cents to 26 cents a share. Analysts, polled by Thomson Reuters, anticipated 26 cents a share.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

(END) Dow Jones Newswires

November 17, 2016 07:25 ET (12:25 GMT)

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