Best Buy Beats Q1 Estimates, Shares Jump
Shares of Best Buy Co Inc (NYSE: BBY) jumped more than 9 percent in pre-market trading after the company reported stronger-than-expected results for the first quarter on Thursday.
The Richfield, Minnesota-based company posted quarterly net earnings of $129 million, or $0.36 per share, compared to $461 million, or $1.31 per share, in the year-ago quarter. Excluding non-recurring items, the company's adjusted earnings came in at $0.37 per share.
Of note, net earnings a year ago includes the acceleration of a non-cash tax benefit of $353 million as a result of reorganizing European legal entities. According to a company spokesperson, the reorganization was made "to simplify...overall structure in Q1 a year ago."
Adjusted, Best Buy made $131 million in the quarter, compared to $123 million -- excluding a tax credit -- a year earlier.
Its revenue declined to $8.56 billion from $8.64 billion. However, analysts were expecting earnings of $0.29 per share on revenue of $8.46 billion.
The average estimate among 22 Estimize users was for earnings of $0.31 per share and revenue of $8.56 billion.
Best Buy's same-store sales rose 0.6 percent in the quarter.
Domestic revenue climbed 1.4 percent year-over-year to $7.9 billion in the quarter, while international revenue slipped 22.1 percent to $668 million.
Hubert Joly, Best Buy president and CEO, said, "Throughout the quarter, our strategy of delivering ‘Advice, Service and Convenience at Competitive Prices' continued to resonate with our customers. While merchandising, marketing and operational execution were the tactical drivers of our better-than-expected first quarter financial results, strategically, we believe the cumulative impact of the progress we have made to improve our multi-channel customer experience is what has allowed us to consistently outperform the market. We have made real progress and it is showing up in our results."
Best Buy shares climbed 9.53 percent to $37.00 in pre-market trading.
Editor's note: A comment from the company regarding reorganization has been added.
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