The office supplies retailer say it sacrificed some sales to improve online profitability. It also redesigned its business-facing e-commerce site, StaplesAdvantage.com.
Sales for Newegg.com increased 9.0% to $2.29 billion in 2009 and grew 14.1% in Q4. But net income in the fourth quarter and the full year declined by 32.8% and 13.5%, respectively.
Web sales at online personal computer and consumer electronics retailer Newegg Inc. increased in the fourth quarter and for 2009, but profits fell.
In an updated initial public offering document Newegg, No. 9 in the Internet Retailer Top 500 Guide, filed on Monday with the U.S. Securities and Exchange Commission, the company reported:
- Sales increased 9.0% to $2.29 billion from $2.10 billion in 2008.
- North American sales increased 3.4% to $2.15 billion from $2.08 billion in 2008.
- Sales in China increased 333.9% to $135.8 million from $31.3 million in the prior year.
- Net income declined year over year 13.5% to $24.9 million from $28.8 million.
- The average order was $191 compared with $182 in the prior year.
- Advertising and marketing expenses increased 16.2% to $25.1 million from $21.6 million.
- Selling, general and administrative expenses increased 7.1% to $196.7 million from $183.7 million in 2008.
For the fourth quarter ended Dec. 31, Newegg also reported:
- Sales increased 14.1% to $654.6 million from $573.5 million in the fourth quarter of 2008.
- Net income declined year over year 32.8% to $4.5 million from $6.7 million.
- The number of active customers increased 15.4% to 4.5 million compared with 3.9 million in the fourth quarter of the prior year.
- The number of total orders increased 2.9% to 3.6 million compared with 3.5 million in the fourth quarter of 2008.
- The number of total visits increased 21.0% to 118.0 million compared with 97.5 million in the fourth quarter of the prior year.
Newegg, which filed for an IPO in September, wants to raise $175 million through a public offering from the sale of up to 14.1 million shares at a minimum of $12.36 per share. The company, which carries an online inventory of more than 33,000 products and has been selling on the web since 2001, will use the proceeds for general expansion, including $25 million to build an Asian headquarters and a regional warehouse, fund operating expenses in China, and improve the logistics infrastructure of its Canadian operations. Newegg has yet to say when it will go public.