Best Buy Co., Inc. (NYSE:BBY), the world's largest consumer electronics chain, on Thursday reported a huge drop in holiday sales, leading the struggling electronics retailer to cut its forecast for fourth-quarter earnings.

For the nine weeks ended Jan. 4, 2014, same-store sales fell 0.8 percent and total revenue dropped 2.6 percent to $11.45 billion from $11.75 billion. Domestic revenue of $9.75 billion declined 1.5 percent compared to the year-earlier period.

“When we entered the holiday season, we said that price competitiveness was table stakes, and an intensely promotional holiday season is what unfolded,” said

Hubert Joly, Best Buy's president and CEO. He added that its decision to cut prices to match rivals' price cuts "did come with a higher-than-expected cost, and we now estimate our fourth-quarter non-GAAP operating income rate will be 175 to 185 basis points lower than last year."

Shares tumbled 26 percent in midday trading.

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