NutriSystem Plunges 30% On Earnings (NTRI)

NutriSystem NTRI released its Q4 earnings results after the closing bell on Thursday. The company reported EPS of $0.25 per share, which was in line with analysts' consensus EPS estimates. Revenues were down 16.7% year over year to $87.9 million. This compared with Street consensus of $100.6 million. Looking ahead, the company sees an EPS loss between $0.30 and $0.35 in Q1, but this may not be comparable to consensus of $0.31. For fiscal 2011, NTRI sees EPS between $0.40-$0.50, which may not be comparable to consensus of $1.32. The stock is down 30% in after hours trading. According to the company's statement, "As we moved into 2011, a major new product launch in the commercial diet industry impacted our January sales. We reacted quickly and our price rollback promotion had an immediate positive impact on customer starts, but at the expense of gross margin. To preserve profitability and cash flow, we are taking the immediate hard action needed to further reduce costs. Longer term, it is clear that we need new product offerings and new sales channels to re-energize top-line growth going forward, and to that end we plan to invest in new product development efforts in 2011."