In recent times, RadioShack has redesigned its retail website with new deals in the offing, in an effort to ramp up sales. However, despite such efforts, the company's shares have tumbled more than 50% over the last one month. Nowadays, consumers prefer making online purchases to visiting retail stores. As a result, RadioShack's core Consumer Electronics retail business has been on a secular downtrend. RadioShack is also facing a cash deficit situation and may file for bankruptcy if it fails to improve its cash balance. RadioShack reported dismal financial numbers for the third quarter of fiscal 2015. Both the top and the bottom line significantly missed the Zacks Consensus Estimate. We maintain our Neutral recommendation on RadioShack.
Headquartered in Fort Worth, TX, RadioShack Corp. (RSH) is one of the leading consumer electronics specialty retailers in the U.S., offering innovative products and services from leading brands. The company has operations in Mexico also. RadioShack's products include wireless telephones and communication devices, such as scanners and global positioning satellite navigation units flat panel televisions, residential telephones, DVD players, computers, and direct-to-home (DTH) satellite systems home entertainment, wireless, imaging, and computer accessories general and special purpose batteries wire, cable, and connectivity products and digital cameras, radio-controlled cars and other toys, satellite radios, and memory players. The company also provides consumers access to third-party services, such as wireless telephone and DTH satellite activation, satellite radio service, prepaid wireless airtime, and extended service plans.
RadioShack operates in two reportable segments as follows:
Company Operated Stores: This segment consists of 4,463 company-operated retail stores in the U.S., all operating under the RadioShack brand name. The company-operated stores sell various wireless products, electronic accessories, power accessories, residential telephones, VoIP products, home audio and video end products, direct-to-home satellite systems, and computers.
Other: This segment consists of business activities that are not separately reportable, which include RadioShack's kiosk sales and sales from worldwide dealer network, e-commerce, third-party service centers, manufacturing and foreign operations.
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