People enter a Best Buy store in a Brooklyn mall on August 29, 2023 in New York City.
Spencer Platt | Getty Images
Best buy The group raised its profit forecast for the financial year on Thursday after beating profit and revenue expectations for the most recent quarter.
The retailer now expects full-year adjusted earnings per share of $6.10 to $6.35, up from a previous range of $5.75 to $6.20. The company, however, lowered the upper end of its guidance for full-year revenue and comparable sales.
“As we look to the second half of the year, we expect our industry to continue to show increasing stabilization,” Matt Bilunas, Best Buy’s chief financial officer, said in the company’s press release.
Best Buy shares jumped 6% in premarket trading Thursday.
Here’s how the consumer electronics retailer performed for the period ended Aug. 3 compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Earnings per share: $1.34 vs. $1.16 expected
- Income: $9.29 billion versus $9.24 billion expected
The company reported net income for the quarter of $291 million, or $1.34 per share, compared with $274 million, or $1.25 per share, a year earlier.
Net sales for the quarter fell to $9.29 billion from $9.58 billion in the same period a year earlier.
Comparable sales fell 2.3% in the quarter, compared with a 6.2% decline a year earlier.
Best Buy is trying to recover from two years of declining sales. The consumer goods retailer has been grappling with weaker consumer demand following unusually strong sales during the Covid-19 pandemic and a consumer pullback due to high inflation.
As the long-awaited replacement cycle of pandemic-era tech purchases begins to take hold, the retailer is hoping to capitalize on it through marketing and operational initiatives. Best Buy said in July it would add trained sales teams to three key areas of its stores (computers, appliances and home theater) and launch a marketing campaign that will include YouTube videos to drive consumer engagement.
The company also said it was betting on a wave of new tech gadget launches, such as a collection of new iPads launched by Apple in May and laptops with artificial intelligence touted by Microsoft.
During the company’s fiscal first-quarter earnings call in May, Best Buy executives said they expect sales trends to “improve sequentially” and industry stabilization to increase in 2024.
Consumer electronics sales are on a downward trend and are expected to decline by another 2% in 2024, according to the latest research from market research firm Circana.
