UPDATE: 7:25 a.m. EDT -- Best Buy Co Inc said Tuesday its quarterly revenue fell 1.3 percent, the third straight quarter of decline, as strong demand for wearable devices, appliances and home theaters failed to offset weak sales of mobile phones and computers.
However, the largest U.S. consumer electronics retailer said the net income attributable to shareholders rose to $229 million, or 70 cents per share, in the first quarter ended April 30 from $129 million, or 36 cents per share, a year earlier. Revenue fell to $8.44 billion from $8.56 billion.
Best Buy also forecast current-quarter profit below analysts' estimates, partly due to a disruption in supply of some high-margin products after an earthquake in Japan, and the company said its Chief Financial Officer Sharon McCollam would step down on June 14.
Electronics retailer Best Buy Co. Inc. will report its earnings for the first quarter of fiscal year 2016-17 before markets open Tuesday, and is expected to post slightly lower revenue and profit compared to the same quarter last year. For the three months ended April, a consensus of analysts polled by Reuters estimates earnings per share (EPS) of 35 cents on a revenue of $8.29 billion.
During the first quarter of the previous fiscal, the retailer had revenue of $8.56 billion and EPS of 37 cents. The expected EPS is at the higher end of the 31 cents to 35 cents range the company gave in its guidance at the end of the last quarter. The estimated net profit for the quarter just ended is expected to come in at $112.24 million, compared with $130 million in the first quarter last fiscal.
A quarter-on-quarter comparison with November-January would show the expected results in a far worse light, but given the boost to all retailers from the holiday season, it would not be a fair comparison to make.
The expected decline in revenues can be chalked up to general struggle of the larger retail sector, which has seen sluggish demand the last few months, even though consumer spending picked up in April. Brick-and-mortar stores like Best Buy face additional pressure from online retailers who offer extremely competitive prices.
Compared to some of its peers, however, Best Buy has managed to hold its own through a turnaround plan that has kept prices low. Increased sales of wearables, as well as Super Bowl-fuelled sales of large television sets in February, are expected to contribute to an arrest in declines at the Minneapolis-based retailer.
Best Buy shares have risen 8.31 percent on the New York Stock Exchange since the start of 2016, far outpacing the Dynamic Retail Intellidex, which fell by 9.17 percent in the same period, as well as the broader markets. At the close of Monday, Best Buy shares were up 2.01 percent, but lost 0.73 percent during after hours trade.
Data from Reuters were used to report this story.