Best Buy’s 3Q comps increase 4.6%

Best Buy achieved strong profit growth and market share gain during its third quarter, thanks in large part to a 4.6% same-store sales increase at U.S. stores.

Excluding the impact of a non-operating impairment charge incurred in the previous year’s third fiscal quarter, diluted earnings per share increased 51% versus the prior-year period’s adjusted diluted earnings per share of 35 cents.

During the quarter, Best Buy’s total revenue increased 5% to $12 billion, compared with revenue of $11.5 billion for the third quarter of fiscal 2009. The revenue increase reflected the addition of 127 net new stores in the past 12 months and a comparable-store sales gain of 1.7%. Revenue gains were partially offset by the unfavorable impact of foreign currency fluctuations. The majority of the revenue growth came from the company’s domestic segment, which saw third-quarter revenue increase 9% to $8.9 billion as customer traffic and average transaction size increased.

The company said that domestic comparable-store sales improved sequentially each month of the fiscal quarter, finishing with an 8.4% increase in the fiscal month of November, as the company experienced low double-digit comparable-store sales gains on Friday and Saturday of the Thanksgiving holiday shopping weekend. Furthermore, the company reported that domestic online sales for the fiscal third quarter increased more than 20% versus the prior year period on higher Web site traffic and average ticket.

“Our revenue and earnings performance in the fiscal third quarter was strong considering the continuing challenges on overall consumer spending in the retail environment,” said Jim Muehlbauer, Best Buy’s EVP finance and CFO. “We are pleased with the continued stabilization of store traffic and our significant share growth in the third fiscal quarter. We now forecast greater revenue and earnings for the year, and as a result, we are raising the bottom and top ends of our full year guidance. While a large portion of the key holiday selling season remains ahead and consumers are clearly being very conscious of what they buy and from whom they make purchases, the trends we experienced in the third quarter continue to provide encouragement about what lies ahead in the balance of the fiscal year.”