Oakley Issues Second-Half Warning
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Oakley Inc.’s shares tumbled 37% on Thursday after the maker of trendy sunglasses said second-half earnings will fall because its single largest customer has unexpectedly reduced its orders.
The stock fell to a 52-week low of $11 before closing at $11.03, off $6.46 on the New York Stock Exchange.
Oakley said that Sunglass Hut, which accounts for 19% of the Foothill Ranch company’s sunglasses sales, reduced its orders, although Sunglass Hut’s parent said it intended to continue ordering Oakley products at the same level.
Oakley’s relationship with retailer Sunglass Hut has been the subject of speculation since the Florida chain was acquired in April by Luxottica, which owns sunglass brands Ray-Ban and Arnette, making the Italian company an Oakley competitor.
Oakley expects profit of 21 cents to 23 cents a share in its third quarter, and 13 cents to 16 cents in its fourth quarter.
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