Skullcandy's sales fell by 30.4 percent in the first quarter due to a more selective sales policy in North America, where its turnover dropped by 37.9 percent to $28.7 million. In the rest of the world, the headphone company's sales increased by 17.5 percent to $8.4 million but were essentially flat on an adjusted basis, excluding sales made directly from North America to foreign customers. The gross margin declined to 44.5 percent and the company incurred an operating loss of $9.8 million in the quarter, compared with a profit of $1.5 million in the year-ago period, and a net loss of $7.0 million against net income of $1.1 million. Hoby Darling, who was recently appointed president and chief executive, wants to broaden the brand's equity beyond the action sports sector and develop more technology-driven and innovative products. He indicated that the brand's message needs to be more clearly defined.

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