Beginning with this quarter, the company used a different methodology for calculating comp-store sales, one that includes extended warranties, installations and other non-merchandise revenues. Previously, revenues included in comp-store sales calculation were limited to merchandise sales. The new methodology resulted in somewhat better results for the company; Q4 comps, for example, would have been a 2.9% decrease under the former methodology, and for fiscal 2004, the company's same-store comps would have posted a 0.2% decline.

Certain products and services provided to be a letdown during Q4. Circuit City cited a decrease in wireless sales to account for 100 basis points of the company's overall comp-store sales decrease in the quarter. Also, a decrease in digital video service sales accounted for about 80 more basis points of the decline. The holiday month of December proved particularly weak for the company, which saw a 5% comp-store decline during the month compared to December 2003.

Still, the company asserts that things after the holiday season have been looking up. "We believe that the improving trend in sales since December reflects early improvements in our promotional and advertising effectiveness that translated into increased consumer traffic as the quarter progressed," said W. Alan McCollough, chairman and CEO, in a statement issued Friday. "We continue to take steps to move our business forward and are beginning to see initial results from the recent changes we have implemented."