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Best Buy Reports Better-Than-Expected Q4, Initial Q1 Guidance

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Shares of Best Buy Co Inc (NYSE: BBY) were trading higher by around 1 percent after the company reported its fourth quarter results.

Best Buy said it earned $1.53 per share in the fourth quarter on revenue of $13.623 billion. Wall Street analysts were expecting the company to earn $1.39 per share on revenue of $13.61 billion.

Best Buy noted that its domestic revenue fell 1.5 percent from a year ago, primarily driven by a comparable sales decline of 1.8 percent and the loss of revenue from 13 large format and 17 small format Best Buy Mobile store closures. In addition, comparable sales growth in health & wearables, home theater and appliances was more than offset by a "significant" decline in mobile phones, tablets and digital imaging.

Online sales rose 13.7 percent from a year ago to $1.95 billion and accounted for 15.6 percent of total domestic revenue, marking an increase from 13.6 percent a year ago.

International revenue fell 26.2 percent from a year ago to $1.1 billion due to foreign exchange rates, store closures in Canada and softness in the Canadian economy and consumer electronics industry.

Net earnings attributed to investors fell to $479 million in the quarter from $519 million a year ago.

Looking forward to the first quarter, Best Buy expects to earn $0.31 to $0.35 per share on revenue of $8.25 billion to $8.35 billion. Both figures fell short of Wall Street's expectations that are calling for earnings of $0.39 per share on revenue of $8.45 billion.

Hubert Joly, Best Buy chairman and CEO, commented, "In the fourth quarter, we delivered Enterprise revenue of $13.62 billion, improved our non-GAAP operating income rate by 10 basis points to 5.9% and delivered a better-than-expected non-GAAP EPS of $1.53 versus $1.48 last year. In our Domestic business, we exceeded our bottom-line expectations due to a well-executed holiday plan, a disciplined promotional strategy, better recovery on returned and clearance product and strong expense management. While Domestic revenue declined 1.5%, it was against a backdrop where the NPD-reported categories were down 5.1%.8 In addition, we continued to drive significant growth in the online channel – with eCommerce revenue increasing nearly 14% to 15.6% of total Domestic revenue."

Posted-In: best buy Best Buy Earnings consumer electronics Hubert JolyEarnings News Guidance

 

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