Best Buy hikes sales forecast as shoppers upgrade tech, splurge on devices

Best Buy hiked its full-year forecast Tuesday, as it topped Wall Street’s quarterly sales expectations and customers turned to the retailer to upgrade tech devices and splurge on new computers, gaming consoles and smartphones.

The consumer electronics retailer said it now expects revenue of between $41.65 billion to $41.95 billion for the full year, higher than its previous range of $41.1 billion to $41.9 billion. It expects adjusted earnings per share of $6.25 to $6.35, compared to its prior range $6.15 to $6.30.

Best Buy said it expects full-year comparable sales, a metric that tracks sales online and at stores open at least 14 months, to range between a 0.5% rise to a 1.2% increase, compared to its previous expectations for a 1% decline and a 1% climb.

In the company’s news release, CEO Corie Barry said Best Buy saw “better-than-expected sales” for the quarter because of strong results across computing, gaming and mobile phones. She said sales grew across both its website and stores.

“We are flexing the unique strength of our model as customers need to upgrade or replace their consumer electronics and new products and innovation are coming to market,” Barry said.

She said the quarterly results are “setting us up well for an exciting holiday season.”

Here’s how the retailer did for the three-month period that ended Nov. 1 compared with what Wall Street was expecting, according to a survey of analysts by LSEG:

• Earnings per share: $1.40 adjusted vs. $1.31 expected
• Revenue: $9.67 billion vs. $9.59 billion expected

Best Buy has been waiting for some of the key catalysts that tend to drive its business, such as higher housing turnover that leads to appliance purchases, the tech innovations that spark demand for devices and expert advice and the increased willingness by inflation-weary consumers to splurge on discretionary items.

Some of that tech innovation appears to be gaining momentum with sales of the Nintendo Switch 2, new iPhones and AI-enabled laptops. The company called out those merchandise categories as strengths in the most recent three-month period.

Best Buy’s net income for the fiscal third quarter fell to $140 million, or 66 cents per share, from a net income of $273 million, or $1.26 per share, in the year-ago period.

Revenue rose from $9.45 billion in the year-ago quarter.

Best Buy’s comparable sales increased 2.7% year over year. In the U.S., the metric jumped 2.4%, as shoppers bought computers, gaming systems and mobile phones, but bought fewer appliances and home theaters.

Best Buy’s annual revenue has dropped for the past three years. With the updated guidance, the company expects annual revenue to be slightly higher than last year’s total of $41.53 billion.

As of Monday’s close, shares of Best Buy have dropped by about 12% so far this year. That compares to the 14% gains of the S&P 500 during the same period.

This is breaking news. Please check back for updates.