Shares of Best Buy Co Inc BBY fell in the pre-market hours after quarterly sales lagged estimates on weak demand for gaming consoles, tablets, wearables and mobile phones. The company guided first quarter earnings below consensus.
The sales weakness and tepid guidance overshadowed the fourth quarter earnings beat, driven by disciplined promotional strategy, continued optimization of merchandise margins and strong expense management.
Following is a gist of Best Buy’s fourth quarter results:
- Best Buy Reports Q4 Adj. EPS $1.95 vs $1.67 Est., Sales $13.482B vs $13.62B Est.
- Best Buy Sees Q1 Adj. EPS $0.35-$0.40 vs $0.49 Est., Enterprise Sales $8.2B-$8.3B
- Sees Q1 Enterprise Comps of (1.0%) to (2.0%)
- Sees Q1 Domestic Comps of (1.5%) to (2.5%)
- International comparable sales change in the range of flat to 3.0%
- Sees FY18 Enterprise Sales Growth ~1.5%
- Reports 2-Year $3B Buyback Plan; Raises Qtr. Dividend from $0.28 to $0.34/Share
The company’s domestic revenue fell 1.4 percent to $12.3 billion on a comparable sales decline of 0.9 percent and the loss of revenue from 11 large format and 31 Best Buy Mobile store closures.
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“[O}ur revenue was hindered by unprecedented product availability constraints across multiple vendors and categories, only some of which were anticipated. Additionally, there was considerably weaker-than-expected demand in the gaming category,” CEO Hubert Joly said in a press release.
Shares of Best Buy closed Tuesday at $44.13. In the pre-market hours, the stock was down 2.95 percent to $42.83.
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