Best Buy Conference Call Highlights

reported its third quarter earnings on Thursday. Shares of the company are up 7 percent. Below are some key highlights from its conference call.

• Our team delivered positive comparable sales, improved profitability and continued progress in our Renew Blue transformation. • This resulted in $9.4 billion in revenue and $0.32 in non-GAAP diluted earnings per share versus $0.18 last year. • Operationally, this year-over-year improvement was primarily driven by a 0.6% revenue growth and the benefit from our Renew Blue and other SG&A cost reduction initiatives. • On the top line, while sales in the NPD-reported Consumer Electronics categories declined 0.2%, our strength in televisions, computing, and tablets versus the industry. • In addition to our growth in gaming and appliances, drove a domestic comparable sales increase of 2.4%. • Domestic online comparable sales increased 22%. • Also during the quarter, we continued to make progress against our Renew Blue priorities. • In merchandising, we continued to expand our appliance offering for the opening of 15 Pacific Kitchen and Home stores-within-a-store and are on track to end the year with 117 stores versus 67 last year. • In home theater, we opened 10 Magnolia Design Center stores within a store and are on track to end the year with 50 stores versus 33 last year. • We also continued to expand our ultra-high definition, or 4K, TV assortment. • In mobile, despite major phone launches being quality constrained, the adoption of installment bidding plans continued to accelerate throughout the quarter. • Within these plans, we saw higher average phone prices and higher attach rates of services and phone accessories. In phone accessories. • We significantly expanded our exclusive assortment through new partnerships with fashion designers and growth in our own private label brands. • This allowed us to offer our customers an industry-leading phone case assortment in time for the new iPhone launch. • In our retail stores during the quarter, we continued to improve the physical presence and shopping experience by expanding our fleet of appliance and home theater stores-within-a-store. • Increasing our investment in store refresh initiatives, adding compelling vendor displays. • Increasing sales training and integrating new vendor-funded labor into our premium customer experiences. • While traffic to our stores continued to decline year-over-year, the trends improved compared to the first half of the year. • In services, we continued to increase our NPS, or Net Promoter Scores, and drive down costs through operational efficiencies. • We also launched a loss and theft mobile phone insurance program to supplement our historical Geek Squad protection plans.

• So number one is the customer facing changes that we have on our site and in our stores, including the merchandising and labor upgrade I discussed earlier, that touched many of our key categories, especially home theater, accessories, appliances, emerging categories such as health and wearables and connected home and digital imaging. • Second, our ability this year to sell installment billing plans in the mobile phone category. • Third, a more inspirational gifting strategy, including a greater assortment of products below $100. • Fourth is a more defined and structured approach to our promotional strategy, including greater analytics around competitive response plans. • Fifth, more relevant and targeted marketing investments, including a more concise statement of our value proposition, Expert Service. Unbeatable Price. • And sixth, increased inventory availability due to the rollout of ship-from-store to 1,400 stores versus 400 stores last year.

• Enterprise revenue increased 0.6% to $9.4 billion. • Enterprise non-GAAP diluted EPS increased $0.14 to $0.32, primarily driven by higher revenues and the flow-through of our Renew Blue and other cost reduction initiatives. • We also saw a $0.02 per share benefit associated with the restitution from a legal claim. • In addition, the lower tax rate this year drove an incremental $0.02 per share benefit due to favorable discrete tax events. • Domestic revenue of $8 billion increased 2.3% versus last year. • This increase was partially offset by the timing of recovery on mobile phone trade-in liquidations, store closures. • Domestic online revenue was $601 million and comparable online sales increased 21.6%,