Prime Highlights:
- Best Buy boosts its full-year sales and earnings outlook after strong demand for computers, gaming consoles, and smartphones.
- Comparable sales rise 2.7% year-over-year, marking the company’s highest growth in four years.
Key Facts:
- Best Buy’s annual revenue has been declining for the past three years, but the new guidance points to a slight increase above last year’s total of $41.53 billion.
- The company’s comparable sales in the U.S. rose 2.4%, fueled by purchases of computers, gaming systems, and mobile phones.
Background:
Best Buy, a leading electronics store, has raised its sales and earnings forecast after strong demand for tech products.
The company did better than expected in the third quarter, with more sales of laptops, gaming consoles, smartphones, and other devices. CEO Corie Barry said sales were strong both online and in stores.
With the new forecast, Best Buy now expects full-year revenue of $41.65 billion to $41.95 billion, up from the previous range of $41.1 billion to $41.9 billion. Adjusted earnings per share are projected to be $6.25 to $6.35, higher than the prior estimate of $6.15 to $6.30.
During the quarter that ended November 1, Best Buy reported adjusted earnings per share of $1.40, surpassing analyst expectations of $1.31. Revenue reached $9.67 billion, beating the $9.59 billion forecast. Shares rose approximately 5% following the announcement.
Barry noted that customers are careful with their spending but will buy expensive, innovative products when needed. Strong sales came from laptops, the Nintendo Switch 2, new iPhones, wearables, and headphones.
Best Buy also started a third-party marketplace in mid-August, which added many new products. Early results show higher sales in items like accessories and small appliances, and returns for marketplace products are lower than for Best Buy’s own items.
Although some categories, such as appliances, continue to lag due to slower housing turnover, the retailer plans to enhance in-store support, speed up deliveries, and offer more same-day availability.
Looking ahead, Best Buy is preparing for the holiday season with deals across various price points and expects comparable sales during the period to range from a 1% decline to a 1% increase.
