CompUSA issues profit warning as sales slow

CompUSA's sales growth slowed in the first three months of 1998, and the company cautions that profits will be less than expected. The company says margins are thin because costs are up while PC prices are continuing to decline. On Apr 1, when the news was released, the company's stock dropped 20%, or $5.25, to $20.875 a share. Earnings are down by three to four cents a share for the company's fiscal 3rd qtr, ended Mar 28. Sales for the period increased 14% to $1.45 billion, from $1.27 billion in the same period in 1997. Meanwhile, at 122 CompUSA stores that have been open at least a year, sales were up only 1.2%. Sales at those same stores increased 5.6% a year earlier, and 8% in the last three months of 1997.