Best Buy Reports Another Quarter of Weak Electronics Sales

James Hyerczyk
Updated: May 30, 2024, 11:43 GMT+00:00

Key Points:

  • Best Buy reports weaker-than-expected Q1 sales, citing ongoing soft demand for electronics.
  • Despite a decline in sales, Best Buy beats EPS estimates and maintains its full-year outlook.
  • CEO Corie Barry announces workforce reductions and cost-cutting measures to manage challenges.
Best Buy

In this article:

Best Buy Reports Sluggish Consumer Electronics Demand

Best Buy reported weaker-than-expected sales for the fiscal first quarter, citing ongoing soft demand for consumer electronics. Despite this, the retailer surpassed earnings expectations and maintained its full-year outlook.

Daily Best Buy

Quarterly Performance

Best Buy’s earnings per share (EPS) came in at $1.20, beating Wall Street’s expectation of $1.08. However, revenue fell short at $8.85 billion versus the anticipated $8.96 billion. The company’s net income for the quarter ended May 4 increased slightly to $246 million, or $1.13 per share, from $244 million, or $1.11 per share, the previous year. Adjusted for one-time items, EPS was $1.20. Despite higher earnings, net sales declined from $9.47 billion a year ago.

Impact of Consumer Behavior

Best Buy has been affected by a decline in discretionary spending as consumers cope with inflation. The company is facing a lull following a surge in demand during the Covid pandemic. This has resulted in a waiting period for the replacement cycle of electronics like laptops and kitchen appliances to normalize. Additionally, new tech gadget releases are anticipated to drive future sales.

Strategic Adjustments

CEO Corie Barry announced earlier this year that the company would reduce its workforce and cut costs to manage the challenging retail environment. Although the number of layoffs was not specified, Best Buy’s employee count has significantly decreased from over 125,000 in early 2020 to around 85,000 as of early February 2024. The company also plans to close 10 to 15 stores in the current fiscal year after shutting 24 stores in the previous year.

Financial Outlook

Best Buy maintained its full-year revenue forecast of $41.3 billion to $42.6 billion, down from $43.45 billion last fiscal year. Comparable sales are projected to range from flat to a 3% decline. The company also reduced its full-year capital expenditures forecast to $750 million from a maximum of $800 million.

Market Forecast

Given the persistent soft demand and inflation pressures, Best Buy’s stock is expected to remain under pressure in the short term. The company’s shares, currently down about 8% year-to-date, are likely to continue trailing behind the broader market. However, strategic investments in growth areas such as artificial intelligence and cost management efforts may provide some support.


Best Buy faces ongoing challenges in consumer electronics demand. The company’s efforts to streamline operations and invest in growth areas will be crucial as it navigates the current retail landscape. Traders should closely monitor consumer spending trends and the impact of new technology releases on Best Buy’s performance.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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