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What Drove Bed Bath & Beyond’s Revenue in Q1 2018?

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First-quarter performance

Bed Bath & Beyond (BBBY) posted revenue of $2.75 billion in the first quarter, a rise of 0.4% from $2.74 billion in the corresponding quarter of the previous year. The company’s revenue was in line with analysts’ expectations.

Revenue growth

BBBY’s revenue growth was driven by the addition of new stores and partially offset by a decline in its SSSG (same-store sales growth). During the first quarter, the company operated 1,557 stores overall, which represented a rise of 11 from the corresponding quarter of the previous year. During the quarter, the company opened seven stores and closed two.

In the last four quarters, the company has increased the store count of its buybuy BABY stores by eight units to 121, its World Market stores by three units to 279, its Christmas Tree Shops by three units to 83, and its andThat! stores by two units to 57. However, during the same period, it decreased the store count of its Bed Bath & Beyond brand stores by five units to 1,017.

The company’s SSSG fell 0.6% during the quarter, with its customer-facing digital channel posting strong SSSG while the SSSG at its stores declined.

Peer comparison and outlook

During the same period, Williams-Sonoma (WSM) posted revenue growth of 8.2%, while RH (RH) posted a revenue fall of 0.8%.

For 2018, BBBY’s management expects its revenue growth to be in the range of flat to slightly positive compared to 2017, which was a 53-week year. The company’s sales are expected to be driven by SSSG and the addition of new stores.

Next, we’ll look at BBBY’s first-quarter SSSG.

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