Customers shop at a Best Buy store on August 24, 2021 in Chicago, Illinois.
Scott Olson | Getty Images
best buy reported Thursday earnings and earnings for the holiday quarter that beat Wall Street expectations as slowing demand for consumer electronics proved better than feared.
Still, shares are down about 2% in premarket trading as the retailer warned of falling sales in the coming year.
For the upcoming fiscal year, the consumer electronics retailer expects sales to range between $43.8 billion and $45.2 billion, down from last fiscal year, and for same-store sales to fall between 3% and 6%.
Here’s how the company fared versus Wall Street expectations for the quarter ended Jan. 28, based on a survey of analysts by Refinitiv:
- Earnings per share: $2.61 vs. $2.11 expected
- Revenue: $14.74 billion versus $14.72 billion expected
Best Buy has been a big beneficiary of sales trends during the Covid pandemic, with consumers buying computer monitors to work remotely, home theaters to while away the time and kitchen appliances while they cook more. Quarterly revenue fell about 3% from the same period before the pandemic, which reported $15.2 billion in revenue.
The dynamics of the pandemic era have left consumer electronics retailers with challenging comparisons, especially as shoppers feel strained by higher grocery bills and other higher spending due to inflation. Best Buy also sells many high-priced items, like laptops and smartphones, purchases that a customer may not make as often or ones that they may put off if they are overwhelmed by other spending priorities.
According to StreetAccount, same-store sales fell 9.3% in the fourth quarter, slightly above analysts’ expectations of 9.2%. For the full year, same-store sales fell 9.9%, in line with the retailer’s forecast published in November that same-store sales would fall by about 10%. The key metric, also called comparable sales, tracks sales online and in stores that have been open for at least 14 months.
Best Buy had joined other retailers this summer and lowered its outlook. That summer also saw an undisclosed number of job cuts across the country.
In the fiscal fourth quarter, Best Buy’s net income fell 21% to $495 million, or $2.23 per share, from $626 million, or $2.62 per share, a year earlier.
As of Wednesday’s close, shares of Best Buy are up nearly 3% so far this year, in line with the performance of the S&P 500 over the same period. Its shares closed at $82.54 on Wednesday, taking the market value to $18.26 billion.
This story evolves. Please check back for updates.
Comments are closed.