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Circuit City Revises Outlook

RICHMOND, VA-Faced with tough competition and a drop in computer and television prices, Circuit City posted a $16-million loss.

By Beverly Ford | Updated on December 20, 2006

RICHMOND, VA-Stiff competition combined with deep discounts on computers and flat-panel televisions to give consumer-electronics retailer Circuit City its first loss in six quarters.

The nation’s second largest electronics retailer, which operates more than 1,600 stores in the US and Canada, reported a loss of $16 million, or nine cents a share, in the third quarter, compared to a year ago when it posted a profit of $10.1 million, or six cents a share. The locally based chain also lowered its sales outlook for fiscal 2007 to between 8% and 9% instead of the 9% to 11% range previously expected.

“The third quarter was volatile for the company,” Philip J. Schoonover, chairman, president and CEO of Circuit City Stores, Inc., said in a conference call with analysts. “While we expected significant selling price declines, the magnitude and velocity has been far more than we anticipated.”

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