Vince Holding Corp (NYSE:VNCE) stock fell 9.75% (As on September 5, 11:11:21 AM UTC-4, Source: Google Finance) after the company lags analysts’ estimates for the second quarter of FY 22. Gross profit was $36.4 million, or 40.8% of net sales, compared to gross profit of $35.4 million, or 45.0% of net sales, in the second quarter of fiscal 2021. The decrease in the gross margin rate was primarily due to unfavorable year-over-year adjustments to inventory reserves, higher product and freight costs, and an increase in promotional activity, partially offset by favorable leveraging of distribution and other overhead costs. Loss from operations was $5.2 million compared to income from operations of $2.6 million in the same period last year. Loss from operations for the second quarter of fiscal 2022 included a $1.7 million impairment charge associated with the Rebecca Taylor indefinite-lived tradename and a $0.9 million impairment charge associated with property and equipment of certain Rebecca Taylor retail stores. Net loss was $15.0 million or $(1.23) per share compared to a net loss of $0.6 million or $(0.05) per share in the same period last year. The Company ended the quarter with 67 company-operated Vince stores and 18 company-operated Rebecca Taylor stores, a net increase of 7 company-operated Rebecca Taylor stores since the second quarter of fiscal 2021. At the end of the second quarter of fiscal 2022, total borrowings under the Company’s debt agreements totaled $115.7 million and the Company had $37.1 million of excess availability under its revolving credit facility.

VNCE in the second quarter of FY 22 has reported the adjusted loss per share of $1.02, missing the analysts’ estimates for the adjusted earnings per share of 19 cents, according to  the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 13.4 percent to $89.19 million in the second quarter of FY 22, missing the analysts’ estimates for revenue by 8.24%. This is due to a 20.5% increase in Vince brand sales and a 27.9% decrease in Rebecca Taylor and Parker sales, combined.

Meanwhile, the Company has the made the strategic decision to wind down its Rebecca Taylor business to focus its resources on the Vince brand. The Company is in discussions with its lenders to finalize the wind down plan, which is expected to include selling off its assets and exiting its various business channels.