Why Genesco (GCO) Shares Are Trading Lower Today - Genesco (NYSE:GCO)

Genesco Inc GCO reported a second-quarter FY23 sales decline of 4% year-on-year to $535 million, missing the consensus of $546.43 million.
Total comparable sales declined 2% versus last year.
Overall sales dropped 7% at Journeys, fell 4% at Schuh, up 22% at Johnston & Murphy, and declined 10% at Licensed Brands versus Q2 FY22.
Adjusted EPS of $0.59 beat the analyst consensus of $0.27.
Gross margin was 47.5%, a 160 basis points contraction Y/Y. Operating margin was 1.7%, and operating income for the quarter was $9.1 million.
The company held $44.9 million in cash and equivalents as of July 30, 2022.
Inventories increased 55% on a Y/Y basis as outsized stimulus demand and supply chain limitations resulted in extremely low inventory last year.
Outlook: Genesco lowered FY23 adjusted EPS guidance to $6.25 - $7.00 from $7.00 - $7.75, against a consensus of $7.35. The company's expectation for adjusted EPS stands near the mid-point of the range.
The company has also lowered FY23 sales growth expectations to down 3% - flat versus the prior view of up 1% - 3%.
Price Action: GCO shares are trading lower by 15.85% at $47.61 on the last check Thursday.

Genesco Plunges After Q2 Revenue Miss, FY23 Outlook Cut