GNC (GNC) reported first-quarter earnings, and while the company matched our internal first-quarter earnings estimates, this was partially the effect of underestimates in gross margin and selling, general, and administrative expenses essentially offsetting each other to produce operating income within a percentage point of our projections. We were correct in expecting the company to slightly exceed estimates but were wrong in believing the results would produce a new round of angst. Indeed, the results were met with a significant silence, both on the earnings call (where the number of institutional questioners dwindled from six to three) and in the market where the initial pre-market bounce quickly dissipated into ongoing malaise. In the end, the first quarter did not deliver any surprises (and largely served to confirm current expectations), while the company's shares will likely remain pressured until the closing of the preferred stock investment.

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