A resurgent Best Buy raises annual outlook on strong Q3
Best Buy is entering the holiday selling season with reasons to celebrate.
The nation’s largest electronics retailer said its income increased to $293 million, or $1.10 per share, in the quarter ended Nov. 2, up from $277 million, or 99 cents per share, in the year-ago quarter. Adjusted earnings came to $1.13 per share compared with the $1.03 analysts were expecting.
Total revenue increased to $9.76 billion, from $9.59 billion, topping analysts’ estimates of $9.70 billion.
Same-store sales rose 1.7%, more than expected, driven by sales of appliances, headphones, tablets, services and computing. Domestic comparable online revenue rose 15% to $1.40 billion, primarily due to higher average order values.
Best Buy has successfully beaten back the challenge once posed to it by Amazon by aggressively expanding its own digital operations, increasing speed of deliveries, launching subscription-based repair and tech support services and enhancing its in-store experience. Looking more long-term, it has made a series of strategic investments in health and wellness technologies.
“Our teams delivered another strong quarter of top- and bottom-line growth,” said Corie Barry, who took the reins as CEO in June. “We are delivering on our purpose to enrich lives through technology by providing customers the products and solutions they want and need, combined with fast and convenient fulfillment.”
Barry said the company is excited about its holiday plans. In October, the retailer announced it will offer free next-day delivery in time for the holiday season.
“Customers ordering online will get free next-day delivery on thousands of items all season long with no membership or minimum purchase required,” she noted. “They can also choose to pick up their products in a store within an hour of placing their order.”
Best Buy raised its annual forecast for adjusted earnings to $5.81 to $5.91 per share from a prior estimate of $5.60 to $5.75 per share. Analysts were expecting Best Buy to earn $5.74 per shares in 2020, excluding items. The company expects enterprise revenue of $43.2 billion to $43.6 billion, up from $43.1 billion to $43.6 billion.