Televisions for sale at a Best Buy store in New York City.
Andrew Kelly | Reuters
Best buy on Tuesday said sales fell about 13% in the fiscal second quarter, as the retailer felt the drop from inflation-weary shoppers.
The retailer reaffirmed its full-year guidance, saying it expects demand for consumer electronics to drop as people pay more for groceries and gas. It expects same-store sales to drop about 11% in the 12-month period ending January. The company has cut full year and second quarter forecasts at the end of July.
Here’s how the retailer did in the three-month period ending July 30 compared to what Wall Street had predicted, according to a survey of analysts by Refinitiv:
- Earnings per share: $1.54 adjusted vs $1.27 expected
- Revenue: $10.33 billion vs. $10.24 billion expected
Best Buy’s quarter reflects a dramatic shift in consumer spending habits. A year ago, the retailer saw Sales increased by nearly 20% as shoppers buy TVs, laptops and more to maintain pandemic-induced habits like working from home and streaming movies.
Now, however, some of those patterns have faded as people return to the office or go on vacation. Some consumers are skipping big-fare and discretionary items as they pay more for essentials.
Sales online and in stores open for at least 14 months, a key indicator known as same-store sales, fell 12.1% year-over-year. That’s slightly better than Best Buy’s guidance, which predicts a drop of about 13% over the current three-month period.
Best Buy’s quarterly net income fell to $306 million, or $1.35 per share, from $734 million, or $2.90 per share, a year earlier. Excluding items, it earns $1.57 per share.
As of the end of Monday, Best Buy stock is down about 27% so far this year. Shares closed Monday at $73.70, down less than 1%. The company’s market value is about $16.6 billion.
This story is evolving. Please check back for updates.
