March 9, 2010, 12:00 AM

Web sales short-circuited for PC Mall last year

The tough economy clearly took its toll on web sales for PC Mall in 2009. Web sales declined 21.5% to $161 million and total sales dropped by 14.4%.

The tough economy clearly took its toll on web sales for PC Mall Inc. in 2009.

For the year ended Dec. 31, PC Mall, No. 72 in the Internet Retailer Top 500 Guide, reported:

  • Web sales declined 21.5% to $161.0 million from $205.0 million in 2008.
  • Total sales declined 14.4% to $1.13 billion from $1.32 billion in 2008.
  • Catalog sales declined 12.7% to $969.0 million from $1.11 billion in 2008.
  • Net income decreased 64.6% to $3.4 million from $9.6 million in the prior year.

Internet Retailer calculates the web accounted for 14.4% of total sales compared with 15.5% in the prior year.“The pricing environment across our segments was challenging and this price pressure resulted in a decline in our gross profit for the quarter,” says CEO Frank Khulusi. “The decline in gross profit, coupled with the investments we have continued to make to position ourselves for future growth, caused our operating income to decline. We remain cautiously optimistic about the demand environment going forward, and expect gross margins to improve sequentially in the first quarter of 2010."


PC Mall, which doesn’t break out quarterly web sales, also reported:

  • Total sales, including catalog and web, increased 0.8% to $337.0 million in the fourth quarter from $334.3 million in the prior year.
  • Net income decreased 91.6% to $83,000 from $984,000 in the prior year.

“In the first quarter of 2010, we have taken steps to reduce personnel expenses in our corporate and other segment by nearly $2.5 million on an annualized basis,” says Khulusi. “We are committed to growing both our top-line and our operating income, and our goal is to return to a quarterly non-GAAP operating margin of between 1.5% and 2% by the fourth quarter of 2010."


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