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Toys R Us reports gloomy holiday sales

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Toys R Us says key sales figure fell 4.5 percent during holiday season

WAYNE, N.J. (AP) -- Toys R Us reported a key sales figure declined in November and December, hurt by weak demand for videogames, electronics and toys and shoppers who pulled back because of Superstorm Sandy.

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(Credit: Getty Images)

The two months are crucial because the holidays can account for up to 40 percent of a retailer's annual sales, particularly a toy retailer.

Toys R Us, the largest specialty toy store chain in the U.S., has beefed up its online offerings, shipping options and exclusive toys to better compete against discounters and online retailers. But that wasn't enough to offset a weak videogame industry, caution due to Superstorm Sandy and a lack of a "hot toy" this holiday season.

"We believe our December sales were impacted by softness in the overall markets for videogames, electronics and toys, and by the uncertain economic environment in the U.S. and abroad," said CEO Jerry Storch.

The privately held toy store owner said revenue from domestic stores open at least one year fell 4.5 percent in the U.S. in November and December combined. In December alone, that figure fell 1.8 percent. The company operates more than 800 namesake and Babies R Us stores in the U.S. and another 600-plus stores overseas.

Learning toys, which include Leapfrog's LeapPad explorer, a tablet for children, was the best category.

Total revenue fell 4.7 percent in the U.S. during the two-month period.

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