J.C. Penney Co. Inc. (JCP) reported sales that were stronger-than-expected for the third quarter. The company has failed to increase its full-year forecast, which further fuels concerns that the upcoming holiday shopping season may be a dud.
The company’s results come after Macy’s (M) and Nordstrom (JWN) reported disappointing sales. Both companies have since cut their yearly outlooks, citing that sales trends were weaker than expected. According to Macy’s, sales decline was caused by warmer-than-usual weather, which reduced sales of winter footwear and outerwear.
J.C. Penney performed better than its peers in the third quarter, reporting a 6.4% increase in sales in established locations. The company also reported an improved gross margin.
Despite this, the department store left its full-year sales forecast unchanged. The company still expects sales to climb between 4% and 5% this year.
J.C. Penney’s shares declined 11% to trade at $7.79 on the news.
The company is still losing money, but is hoping to change things around by pushing sales up and cutting costs. One thing the company plans on doing is focusing more on its private brands, which cost less to carry on store shelves than national brands. The company’s private brands account for more than half of its sales, which offers a significant opportunity to improve its margins.
Revenue for the company increased $2.9 billion, exceeding analyst expectations of $2.86 billion.