Best Buy (BBY) Q4 2023 Results

Customers shop at a Best Buy store on August 24, 2021 in Chicago, Illinois.

Scott Olson | Getty Images

best buy Earnings and revenue for the holiday quarter beat Wall Street expectations on Thursday as the decline in demand for consumer electronics proved better than expected.

Still, the shares were down about 2% in premarket trading as the retailer warned of falling sales over the coming year.

For the upcoming fiscal year, the consumer electronics retailer said it expects revenue of between $43.8 billion and $45.2 billion, down from its last fiscal year and lower comparable store sales of between 3% and 6%. The company expects to feel the majority of this pressure in the first quarter and then stabilize in the second half of the fiscal year.

“We are preparing for another down year for the (consumer electronics) industry,” CEO Corie Barry said on a call with analysts.

Here’s how the company fared for the quarter ended Jan. 28 compared to what Wall Street expected, based on a Refinitiv analyst survey:

  • Earnings per share: $2.61 vs. $2.11 expected
  • Revenue: $14.74 billion vs. $14.72 billion expected

Best Buy has been a big beneficiary of sales trends during the Covid pandemic as consumers bought computer monitors to work remotely, home theaters to pass the time and kitchen appliances while they cooked more . Its quarterly sales were down about 3% from the same period before the pandemic, when it reported revenue of $15.2 billion.

Its momentum in the pandemic era has created tough comparisons for the consumer electronics retailer, especially as shoppers feel strained by bigger grocery bills and other more expensive expenses. inflation driven highs. Best Buy also sells many big-ticket items, such as laptops and smartphones, purchases a customer may not make as frequently or purchases they may put off if stretched by other spending priorities. .

Same-store sales fell 9.3% in the fourth quarter, slightly above analysts’ expectations of 9.2%, according to StreetAccount. For the full year, same-store sales fell 9.9%, in line with the retailer’s forecast released in November that same-store sales would decline about 10%. The key metric, also known as comparable sales, tracks sales online and in stores open for at least 14 months.

Best Buy had joined other retailers in trimming its outlook this summer. It also cut an undisclosed number of jobs across the country this summer.

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.

Best Buy is trying to revive its storefront portfolio to bring the company’s margins back to pre-pandemic levels and “stay relevant in an increasingly digital age,” Barry said during Thursday’s conference call. The overhaul will cost the company $200 million in capital expenditures, about a quarter of the planned capital expenditure of $850 million for fiscal 2024.

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, bringing its market value to $18.26 billion.

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