Dixons Carphone is to close as many as 92 Carphone Warehouse stores later this year due to ongoing challenges in the UK mobile market.
The company said that changing consumer behaviour, such as a less frequent upgrade cycle and the increased popularity of SIM Only tariffs and SIM-free handsets, contributed to a squeezing of margins and flat sales in its mobile division.
UK revenues were down one per cent, but Group revenues rose 3 per cent thanks to growth in Nordics and in Greece.
Dixons Carphone stores
“Eight weeks in the business have cemented my optimism about Dixons Carphone’s long-term prospects. I’ve found exceptional strengths, and though there’s plenty to fix, it’s all fixable,” declared Dixons Carphone CEO Alex Baldock, who joined in April.
“We’re number one in each of our markets, with people and capability no competitor can match. Our opportunity lies in making the most of those strengths, which we are nowhere near doing. And we must: nobody is happy with our performance today.”
Baldock said the increased use of data analytics, new technologies and better marketing would be areas of priority for the company, while it also planned to “address underinvestment” in the colleague and customer experience.
In the UK, the company claimed it was “making progress” in its contractual discussions with the mobile operators about improving business conditions.
“Right now, with our international business in good shape, we’re focusing early action on the UK,” added Baldock. “In electricals, we’re focused on gross margin recovery. In mobile, we’re stabilising our performance through improvements to our proposition and network agreements. In both, we’ll work hard to improve our cost efficiency. We won’t tolerate our current performance in mobile, or as a Group. We know we can do a lot better.”
Carphone Warehouse is the only major retailer where consumers can sign up for services of all four major mobile operators following the collapse of Phones4U in 2014.
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Steve McCaskill is TechRadar Pro's resident mobile industry expert, covering all aspects of the UK and global news, from operators to service providers and everything in between. He is a former editor of Silicon UK and journalist with over a decade's experience in the technology industry, writing about technology, in particular, telecoms, mobile and sports tech, sports, video games and media.