JC Penney is tanking after terrible sales, outlook

Shares of retailer JC Penney are tanking Friday morning after the company painted a gloomy outlook for the rest of 2016.

The company posted a loss of -$0.22 per share against analyst expectations of -$0.30 a share. Sales, however, fell far short of expectations, generating $2.81 billion, just shy of the projected $2.92 billion. Comparable store sales also declined -0.4% against analyst expectations of a 3.3% increase.

In addition, the retailer slashed its projections for the year. JC Penney cut its outlook for gross margins to an increase of only 0.1% to 0.3% from the original projection of 0.4% to 0.6%.

"While our first quarter sales were below our expectations, we are maintaining our annual comp guidance of 3% to 4% as a result of the positive nature of our recent sales trends, the strength of our Sephora business and our decision to accelerate our appliance rollout," said CEO Marvin Ellison in a press release accompanying earnings.

In response to the news, shares of the company are diving in pre-market trading. As of 7:42 a.m. ET, the stock was down a little over 13% at $6.76 a share.