Sears saw its loss more than quadrupled in the first quarter—a big miss compared to what analysts had expected—as cooler weather hurt sales at its stores, suggesting the company's turnaround could take much longer than expected. Revenue, however, beat.
The operator of Sears and Kmart stores also said it is considering putting its service-agreement business up for sale to raise cash.
Shares fell more than 13 percent in after-hours trading. (Click here to get the latest quotes for the company.)
The news comes more than three months after hedge fund billionaire Eddie Lampert took over as CEO from Louis D'Ambrosio, who stepped down due to a family member's health issue.
Some on Wall Street saw D'Ambrosio's departure as adding to Sears' risks, and worried that Lampert's lack of retail sales experience could hurt the company's attempt to turn around its core Sears department stores and Kmart chains.
The retailer is trying to revive itself after suffering from declining sales since 2005, when the hedge fund manager merged the two iconic U.S. retail chains in an $11 billion deal. It has been closing stores, tightly managing inventory, selling real estate and shedding assets.
The company reported a net loss of $279 million, or $2.63 per share, compared with a profit of $189 million, or $1.78 per share, in the year-earlier period.
Excluding items, Sears posted a loss of $1.29 a share, compared with a loss of 31 cents a share a year ago.
Revenue fell 9 percent to $8.45 billion, from $9.27 billion a year ago.
Analysts had expected the company to report a loss of 60 cents per share on $8.37 billion in revenue, according to a consensus estimate from Thomson Reuters.
Same-stores sales fell 3.6 percent at Sears Domestic unit, hurt by the prolonged winter.
The company said it was evaluating strategic options, including a sale, for its protection agreement unit. The business provides customers with service contracts that include repair services and product replacements for damaged goods.
The company launched in November a plan to shore up liquidity by at least $500 million by the end of 2013.