Consumer electronics retailer Best Buy on Tuesday matched Wall Street's target for earnings in its fiscal first quarter on better-than-expected sales. But the company gave cautious guidance. Still, BBY stock rose on the news.
The Richfield, Minn.-based company earned an adjusted $1.57 a share on sales of $10.65 billion in the quarter ended April 30. Analysts polled by FactSet predicted Best Buy earnings of $1.57 a share on sales of $10.41 billion. On a year-over-year basis, Best Buy earnings fell 29.6% while sales dropped 8.5%.
Best Buy's same-store sales dropped 8% in the first quarter, compared with a gain of 37.2% in the year-earlier period. The retailer benefitted from increased spending on home entertainment during the first year-plus of the Covid-19 pandemic.
"Even with the expected slowdown this year, we continue to be in a fundamentally stronger position than we were before the pandemic from both a revenue and operating income rate perspective," Chief Executive Corie Barry said in a news release.
BBY Stock Rises
On the stock market today, BBY stock climbed 1.2% to 73.47, paring earlier gains.
Barry noted that sales have softened in recent weeks.
For the full fiscal year, Best Buy now forecasts adjusted earnings of $8.70 a share on sales of $49.1 billion. That's based on the midpoint of its outlook. Best Buy previously guided to full-year earnings of $9 a share on sales of $50.1 billion.
It now sees same-store sales declining 3% to 6%, vs. its prior outlook for a decline of 1% to 4%.
Heading into the earnings report, concerns about rising inflation and weakening consumer spending weighed on BBY stock. The Best Buy earnings report followed disappointing results last week from retailers Walmart and Target.
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