Hot Topic Earnings: Loss Widens but Beats Estimates

Hot Topic, Inc. (NASDAQ:HOTT) reported its results for the first quarter. Hot Topic Inc. is a mall- and web-based specialty retailer operating the Hot Topic and Torrid concepts, as well as the e-space music discovery concept, ShockHound.

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Hot Topic Earnings Cheat Sheet for the First Quarter

Results: Loss widened to $7.7 million (17 cents/diluted share) from $1.8 million (loss of 4 cents/share) in the same quarter a year earlier.

Revenue: Fell 0.8% to $161.3 million YoY.

Actual vs. Wall St. Expectations: HOTT reported adjusted results of breaking even. By that measure, the company beat the mean analyst estimate of a loss of one cent/share. Estimates ranged from a loss of 2 cents per share to a profit of one cent per share.

Key Stats:

Gross margin shrunk 2.2 percentage points to 31.3%. The contraction appeared to be driven by rising costs as the figure rose 2.5% from the year earlier quarter while revenue fell 0.8%.

Revenue has fallen in the past four quarters. Revenue declined 0.9% to $212.4 million in fourth quarter of the last fiscal year. The figure fell 3.3% in third quarter of the last fiscal year from the year earlier and dropped 4.9% in second quarter of the last fiscal year from the year-ago quarter.

Competitors to Watch: Zumiez Inc. (NASDAQ:ZUMZ), Urban Outfitters, Inc. (NASDAQ:URBN), Abercrombie & Fitch (NYSE:ANF), dELiA*s, Inc. (NASDAQ:DLIA), American Eagle Outfitters (NYSE:AEO), Aeropostale, Inc. (NYSE:ARO), The Buckle, Inc. (NYSE:BKE), Pacific Sunwear of California, Inc. (NASDAQ:PSUN), and The Wet Seal, Inc. (NASDAQ:WTSLA).

Stock Performance: Shares of HOTT are down 2.8% from the previous close.

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