Qurate Q1 Gains As QVC Advances

After completing a spin off from GCI Liberty and changing its name from Liberty Interactive, Qurate Retail, parent of QVC and HSN among other retail operations, posted first quarter net income of $142 million, or 30 cents per share, versus $91 million, or 20 cents per share, in the year-before period.

Adjusted net income, excluding extraordinary charges was $235 million, or 49 cents per share, versus $168 million, or 37 cents per share, in the year-previous period. The adjusted net income per share result topped a MarketBeat-published analyst average estimate of 33 cents.

Total revenue was $3.23 billion versus $3.11 billion in the year-prior quarter, as reported revenue, which accounts for benefits and charges involved in the HSN acquisition and other dealings, advanced to $3.23 billion from $2.33 billion. Total operating income was $302 million versus $264 million and reported operating income was $294 million versus $213 million in the year-earlier period.

QVC U.S. revenue increased 3% to $1.42 billion while that for QVC International increased by 14% to $676 million for a division result up 7% to $2.09 billion from the quarter a year earlier. HSN revenue decreased by 9% to $509 million in the period year over year. Zulily income increased 17% to $419 million while Cornerstone revenue decreased 8% to $207 million, compared to the year prior quarter.

According to Qurate, QVC U.S. enjoyed sales gains in all categories during the quarter year over year except jewelry and electronics. HSN revenue declined in all categories, except beauty, and average selling price slipped primarily due to a product mix shift away from electronics, which tend to carry higher pricepoints than other goods HSN sells. The revenue increase at Zulily resulted primarily from a 24% gain in active customers in the quarter year over year, while the Cornerstone revenue decline derived from weakness in the home segment, particularly in Frontgate and Grandin Road’s outdoor businesses, partially offset by Garnet Hill growth.

“We are pleased to continue our positive revenue performance at QVC and Zulily,” said Mike George, Qurate Retail’s president and CEO. “QVC U.S. grew revenue for the third consecutive quarter and QVC International continued its track record of growth. Zulily built on the momentum from late 2017 and generated mid-teen sales gains. In addition, QVC and Zulily posted solid new customer acquisition in the quarter, and QVC continued to extend its reach to developing platforms like Roku and Facebook Live, and grow customer engagement. While HSN and Cornerstone results remain challenged, we are confident in our ability to turn around both businesses.”