Bidz Faces Delisting, Posts 22% Drop in Revenues

(IDEX Online News) – Bidz.com is facing tough times. NASDAQ is warning the online jewelry retailer that it may be delisted from the stock market, just days after Bidz ended the second quarter with a sharp drop in revenues and earnings, the company reported Monday.

The bid price for Bidz’s common stock has closed below $1.00 for 30 consecutive trading days, failing to meet a minimum requirement for continued listing.

The company said in a release that the management and Board of Directors are considering various alternatives to address this issue.

Bidz has 180 days to regain compliance. To do so, the closing bid price of the company’s common stock must be above $1.00 for a minimum of ten consecutive trading days.

Net revenues for the second quarter ended June 30 were $20 million, falling 22.1 percent, compared with $25.7 million reported in the second quarter of 2010.

According to Bidz, the decline in revenues was primarily the result of reduced demand in jewelry and the change to the company’s new website in March.

International sales accounted for 41.6 percent of revenues. Canada and Australia were among the company’s top international markets representing more than 15 percent of total revenues for the quarter.

Gross profit dropped 27.4 percent to approximately $4.5 million, compared with $6.2 million in the second quarter of 2010. Gross margin in the second quarter of 2011 decreased to 22.6 percent, compared with 24.0 percent in the same period of 2010.