Best Buy hiked its full-year forecast Tuesday, as it topped Wall Street’s quarterly sales expectations and customers turned to the retailer to upgrade tech devices and splurge on new computers, gaming consoles and smartphones.
The consumer electronics retailer said it now expects revenue of between $41.65 billion to $41.95 billion for the full year, higher than its previous range of $41.1 billion to $41.9 billion. It expects adjusted earnings per share of $6.25 to $6.35, compared with its prior range of $6.15 to $6.30.
Best Buy said it expects full-year comparable sales, a metric that tracks sales online and at stores open at least 14 months, to range between a 0.5% rise to a 1.2% increase, compared with its previous expectations for a 1% decline and a 1% climb.
On the company’s earnings call, CEO Corie Barry said Best Buy saw “better-than-expected” sales in the quarter because of strong results across computing, gaming and mobile phones, as well as growth in wearables and headphones. She said sales rose across both its website and stores.
She said customer shopping behavior in the most recent three-month period was about the same as what Best Buy has seen for the past several quarters.
“Customers remain resilient, but deal focused and attracted to more predictable sales moments,” such as back-to-school sales and Best Buy’s October sale that coincided with Amazon’s Prime Day event, she said.
And she said, “while customers continued to be thoughtful about big ticket purchases in the current environment, they are willing to spend on high priced point products when they need to or when there is technology innovation.”
Here’s how the retailer did for the three-month period that ended Nov. 1 compared with what Wall Street was expecting, according to a survey of analysts by LSEG:
- Earnings per share: $1.40 adjusted vs. $1.31 expected
- Revenue: $9.67 billion vs. $9.59 billion expected
Shares were up more than 4% in early trading on Tuesday. As of Monday’s close, Best Buy’s stock has dropped by about 12% this year. That compares with the 14% gains of the S&P 500 during the same period.
Best Buy has been waiting for some of the key catalysts that tend to drive its business, such as higher housing turnover that leads to appliance purchases, the tech innovations that spark demand for devices and expert advice, and the increased willingness by inflation-weary consumers to splurge on discretionary items.
Some of that tech innovation appears to be gaining momentum with sales of the Nintendo Switch 2, new iPhones and AI-enabled laptops. The company called out those merchandise categories as strengths in the most recent three-month period.
Best Buy’s net income for the fiscal third quarter fell to $140 million, or 66 cents per share, from net income of $273 million, or $1.26 per share, in the year-ago period. Adjusting for one-time items, including stock-based compensation and restructuring charges, Best Buy reported earnings of $1.40.
Revenue rose from $9.45 billion…
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