Southeby's Tanking On Q2 Earnings Miss
Sotheby's (NYSE: BID) shares tanked Friday after the auction company posted a 15 percent decline in second-quarter net profits.
Excluding items, net income fell four percent to $1.26 per share, while revenue grew 10 percent to $335.8 million; analysts expected $1.46 per share on revenue of $346 million.
Commission margin decreased to 15.2 percent, from 15.9 percent because of competitive conditions and sales mix.
Sotheby's announced a restructuring plan last month to cut workers and reallocate resources to collecting categories and regions with the highest potential for growth.
In May, Southeby's buried the hatchet with activist investor Dan Loeb, granting his Third Point LLC three seats on its board.
Sotheby's Chief Executive William F. Ruprecht, who earlier this year reportedly called Loeb a "scumbag," told investors Thursday that 26 percent of Southeby's buyers were first-time clients in the first half of 2014.
"We are engaging with a new generation of collectors, and that's exciting," Ruprecht said, noting that a recent eBay partnership "will showcase our New York auctions to an unrivaled global online audience of millions of potentially new collectors."
Southeby's recently traded down 9.8 percent to $36.70.
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