ST. PETERSBURG, Fla. — HSN Inc. reported that net sales for the third quarter increased 5% to $537.4 million, including 10% growth in digital sales. Cornerstone's net sales increased 13% to $241.4 million, including 22% growth in digital sales.
Adjusted EPS increased 32% to 66 cents compared with 50 cents in the prior year. GAAP diluted EPS from continuing operations decreased 26% to 31 cents compared with 42 cents in the prior year.
"Our strong financial performance during the quarter demonstrates the sustained effectiveness of our overall strategy of creating immersive experiences, offering differentiated products and leveraging technology to build relationships, not just transactions," said Mindy Grossman, CEO of HSN, Inc. "This approach enabled HSNi to achieve 7% sales growth and 32% growth in Adjusted EPS. In addition, we continued to return value to shareholders by increasing our cash dividend and through our share repurchase program."
HSN's net sales were $537.4 million, an increase of 5% from the prior year. Digital sales grew 10% with penetration increasing 180 basis points to 34.6%. Strong sales growth primarily in home design, household, culinary and beauty were offset by the expected sales decline in electronics. Shipping and handling revenue decreased 6% primarily due to an increase in shipping and handling promotions. The average price point decreased 4% and the units shipped increased 9% primarily due to changes in product mix.
Net sales for Cornerstone increased 13% to $241.4 million compared with the prior year due to the addition of Chasing Fireflies to the portfolio and sales growth in the home brands. Digital sales grew 22% with penetration increasing 520 basis points to 65.5%. The return rate decreased 120 basis points to 13.6% from 14.8% primarily due to changes in product mix.