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Here are the problems facing retailers

Sale sign in window of Abercrombie & Fitch store
Stephanie Landsman | CNBC
Sale sign in window of Abercrombie & Fitch store

What's up with retail? Several retailers had disappointing commentary, but the issues go beyond individual company problems.

Abercrombie & Fitch (ANF) posted better earnings, but five million fewer shares are outstanding. Same-store sales dropped seven percent. Ouch! We're supposed to be improving. 2014 same-store sales are expected to be down four to six percent, lower than previous guidance of down three to four percent.

Williams-Sonoma (WSM), one of the great retail performers of the last two years (stock has doubled), maintained its guidance for the full year but Q3 guidance is below expectations....the good news is half of their sales are online.

Signet Jewelers (SIG) guided to between $0.12 and $0.14 with current consensus of $0.35...ouch!

Guess (GES) with a 50 percent drop in earnings year-over-year, obviously the assortment didn't go over very well! Talk about losing market share! Lowered guidance as well.

Tilly's (TLYS) guidance was also below consensus of between $0.09 and $0.13, with consensus of $0.19. Same-store sales were down seven percent in Q2, but are projected to be down four to six percent in Q3.

Read MorePlugged-In Over Preppy: Teenagers Favor Tech Over Clothes

So what are the issues? Several points:

  1. An elevated promotional environment has put pressure on margins.
  2. Many of the old names are losing ground to more nimble companies like Zara, H&M, Forever 21 and others. What do they have in common? They turn over fashion quickly, the prices are low and the inventory is tight: Buy it now because it won't be back!
  3. The kids today are more interested in technology than in clothes. They're most interested in having the right cellphone than in having the right jeans. It's Apple and Samsung that are the real teen darlings, not Abercrombie & Fitch.
  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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