Did you hear?... Oakley's 3Q earnings dropped by 16%

Oakley's third quarter results revealed record sales, but earnings dropped by 16 percent.
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Oakley's third quarter results revealed record sales, but earnings dropped by 16 percent. While sales were up, Sunglass Hut -- Oakley's biggest retail customer -- slashed Oakley business by 91 percent or $18 million. Luxottica purchased Sunglass Hut in April and, as a result, Sunglass Hut began stocking Luxottica's sunglasses instead of Oakley's. During the investor conference call, Oakley announced it would be moving to acquire Lacon, a mall-based eyewear retailer, to help offset the loss of Sunglass Hut business. Oakley also announced it would be working more closely with outdoor retail chain Sport Chalet and sports and footwear retail chains Foot Locker, Champ's Sports, and Finish Line. SNEWS® View: Oakley suffered because it placed far too much emphasis on one major retailer instead of establishing a much more diversified distribution base that can weather the loss of or decline in business from one or more key accounts. The company is working to rectify that now, but it will likely be a few more quarters of bad news for investors before the stock rebounds.

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