That's the good news.
The bad: The CE retailer posted a net loss of $164.8 million in the first quarter, compared to $54.6 million a year ago. Additionally, overall sales fell seven percent.
Circuit City blamed the weakening economy for the overall sales decline. However, the retailer's increase in flat-screen HD sales is more evidence that the category is overcoming consumer economic anxieties. Best Buy earlier this month also reported that flat-screen HDTVs continue to sell well.
"Sales of flat panel televisions, particularly large LCDs, continue to grow strongly, increasing by high-single-digit percentage," Circuit CEO Philip Schoonover told Wall Street analysts yesterday in a conference call following release of the company's first quarter report.
Added Circuit City CFO Bruce Besanko: "First from a product perspective, the category with by far the largest sales growth is large LCD televisions."
Some analysts have speculated that rising gas prices could encourage even more consumers to buy expensive HDTVs in the coming months on the theory that it's cheaper to watch movies at home than to drive to theaters.
John Kelly, Circuit City's chief merchandising officer, said he believes that the Summer Olympics this August -- and next year's national switch to Digital TV -- will also help drive set sales.
"We continue to see increased interest in flat panel, specifically large flat panel televisions, and in better technology, such as 1080 and 120 hertz, as well as Plasma," Kelly said yesterday. "And we continue to see consumer demand and consumer desire to purchase these products actually increasing as we go through the year with the Olympics and the holiday season coming, and the conversion to digital next February."
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