What: Shares of Vince Holding Corp. (NYSE:VNCE) were down 38% as of 12:30 p.m. Friday after the contemporary clothing company released disappointing fiscal-second-quarter 2015 results and reduced its full-year guidance.

So what: Quarterly revenue fell 10.4% year over year to $80 million. Specifically, that result was bolstered by a 44.7% increase in direct-to-consumer revenue to $21.7 million, and comparable-store sales growth of 13.4% (including e-commerce), but more than offset by a 21.6% decline in wholesale segment sales to $58.3 million.

Based on generally accepted accounting principles -- which includes a $14.4 million inventory writedown and management transition costs of $2.9 million -- that translated to a net loss of $5.0 million, or $0.14 per diluted share. Remember, in July Vince Holding announced the departures of both its CEO and chief creative officer, and in June suffered the resignation of its CFO. While the company doesn't intend to fill the chief creative officer position for the time being, it has named Mark Brody as Interim CEO. Brody, for his part, is a director on Vince Holding's board, and previously served as director and CFO at Sun Capital Partners, then interim CFO at Vince. David Stefko will step in as Interim CFO, and also previously served as CFO at Sun Capital, as well as CFO and CAO at specialty retailer Things Remembered.

Brody elaborated, "Our second quarter financial performance reflects further weakness in sales trends in our wholesale channel with lower than expected sell-through and customer reorders, which in turn led to a significant increase in inventory levels. As a result, we elected to write down current year product to estimated net realizable value."

In addition, Brody noted because off-price customers reported high levels of inventory, Vince Holding decided to "dispose of the vast majority of prior year product."

Excluding the costs of that writedown and management transitions, Vince Holding achieved adjusted net income of $5.2 million, or $0.14 per diluted share. Even, so, these results fell short of analysts' expectations, as consensus estimates called for adjusted earnings of $0.23 per share on revenue of $86.3 million.

Now what: The situation isn't expected to get easier in the near term, either. For the full fiscal year 2015, Vince Holding now anticipates total net sales of $285 million to $295 million, thanks largely to the wholesale issues mentioned above, but also to "recent softer selling trends" in the direct-to-consumer segment. Adjusted earnings per diluted share for the year should be $0.31 to $0.37. By contrast, analysts were looking for fiscal 2015 revenue of $341.1 million, and earnings of $0.84 per share.

As it stands, Vince Holding stock might look appealing on the surface trading around 6 times trailing-12-month earnings, and 6.3 times next year's estimates. But given this terrible report, I think it's fair to say the stock trades at that discount for a reason. For now, until Vince Holding can stem its declines and demonstrate stability in leadership and sales growth, I think investors would be wise to stay away.

Steve Symington has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.