Rev­enue at HSN dips, but par­ent’s rises

Tampa Bay Times - - Business - BY SARA DINATALE Times Staff Writer

St. Peters­burg-based HSN has seen quar­terly rev­enues drop 5 per­cent com­pared to a year ago, ac­cord­ing to the par­ent com­pany that laid off hun­dreds of Tampa Bay em­ploy­ees last month, Qu­rate Re­tail Group.

Colorado-based Qu­rate Re­tail came out with its third-quar­ter earn­ings on Fri­day, which showed its other home-shop­ping net­work, QVC, had just 1 per­cent in com­par­a­tive rev­enue growth in the pe­riod end­ing Sept. 30. Both at-home shop­ping brands were com­bined un­der one busi­ness unit, “QXH,” to stream­line ship­ping and cut back-end costs, the com­pany an­nounced last month.

The re­tail con­glom­er­ate’s on­line sales site, Zulily, led the com­pany’s rev­enues growth with an 18 per­cent in­crease. The en­tire com­pany — which owns seven brands — grew its rev­enue by 2 per­cent to $3.2 bil­lion.

Its net in­come of $72 mil­lion (or 16 cents a share), was down from earn­ings of $119 mil­lion (26 cents a share) a year ago. But that beat Wall Street ex­pec­ta­tions, ac­cord­ing to es­ti­mates by Zacks In­vest­ment Re­search.

“Our solid third-quar­ter results demon­strate con­tin­ued ex­e­cu­tion of our strat­egy to en­gage our cus­tomers with com­pelling prod­ucts across mul­ti­ple shop­ping plat­forms,” Mike Ge­orge, Qu­rate Re­tail’s pres­i­dent and CEO said dur­ing a con­fer­ence call with in­vestors on Fri­day. “We grew rev­enue and prof­itabil­ity at QVC U.S., im­proved HSN’s sales trend and cus­tomer en­gage­ment trends, and de­liv­ered an­other out­stand­ing quar­ter at Zulily.”

Ge­orge went on to say the “QXH” shift will “yield new rev­enue op­por­tu­ni­ties,” and im­prove cus­tomer ser­vice and op­er­at­ing costs. He said he felt con­fi­dent in the fu­ture of both brands, their com­bined buy­ing power while deal­ing with ven­dors and their grow­ing video com­merce model.

Al­ready, Qu­rate has un­veiled a slew of new so­cial me­dia strate­gies for HSN and QVC, in­clud­ing YouTube shows, pod­casts and In­sta­gram TV videos to reach younger shop­pers dur­ing the on­go­ing shift away from ca­ble-TV shop­ping.

While he didn’t cite any num­bers, Ge­orge said the net­works had mul­ti­ple quar­ters of in­creas­ing view­er­ship on tele­vi­sion.

“There’s still a core TV viewer stick­ing with us,” he said.

How­ever, Ge­orge ac­knowl­edged the broader shift away from ca­ble and to stream­ing ser­vices and said that’s why the com­pany is di­ver­si­fy­ing how it de­liv­ers its pro­gram­ming con­tent, es­pe­cially on mo­bile de­vices.

“We’re in the very early in­nings of where this is go­ing,” he said.

Qu­rate re­ported $1.9 bil­lion of its rev­enue this last quar­ter came from on­line busi­ness.

Its stock closed Fri­day at $24.52 per share, up 3.6 per­cent.

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