Why did Best Buy's stock take a nosedive today, despite a respectable earnings report?Shares of Best Buy (BBY -12.28%) plunged on Tuesday, following a robust earnings report with a side of worrisome management comments. The stock price dropped by as much as 15.9% in the morning session, recovering to a 13.2% loss by 1 p.m. ET.The numbers are better than they lookIn the fourth quarter of fiscal year 2025, Best Buy's sales fell 4.8% year over year to $13.9 billion. To be fair, this reporting period was a stan ...

Best Buy Co., Inc. (BBY) has reported fourth-quarter fiscal 2025 results, wherein revenues and earnings surpassed the Zacks Consensus Estimate. However, both top and bottom lines declined year over year.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Best Buy remains focused on strengthening its position in retail as the leading omni-channel destination for technology and expanding its operating income rate. At the same time, the company is building and scaling incremental profit st ...

Best Buy said Tuesday (March 4) that the U.S. tariffs on China that went into effect Feb. 4 could have a negative impact of about one point of comparable sales if they remain in place for a full year.This is the consumer electronics retailer’s estimate based on the information it has now, but the company did not include the impact of recently added or potential tariffs in its guidance for its fiscal year 2026, which was released Tuesday, because the situation is “highly dynamic,” Best Buy CEO Corie Barry sa ...

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Financial Data and Key Metrics Changes - The company reported almost $14 billion in revenue for Q4, with an adjusted operating income rate of 4.9% and adjusted earnings per share of $2.58, reflecting a 5% decrease in adjusted diluted earnings per share compared to the previous year [10][11][62]. - The enterprise comparable sales growth was 0.5%, with a 2.3% decline on a 52-week basis, indicating the company's ability to maintain profitability in a challenging sales environment [11][62]. - The domestic segment saw a 0.2% increase in comparable sales, while revenue decreased by 5.2% to $12.7 billion, primarily due to the impact of the previous year's extra week [63]. Business Line Data and Key Metrics Changes - The computing and tablet categories experienced a 9% growth in comparable sales, with laptop sales specifically increasing to 10% growth compared to 7% in Q3 [14][15]. - Sales in appliances, home theater, and gaming categories declined, impacting overall performance [14]. - The domestic gross profit rate increased by 50 basis points to 20.9%, driven by improvements in the services category, while the international gross profit rate rose by 40 basis points to 21.4% due to favorable supply chain expenses [65]. Market Data and Key Metrics Changes - Digital sales accounted for almost 40% of total domestic sales in Q4, with significant growth in the Best Buy app, which ranked as the 1 shopping app on the Apple App Store during Black Friday [13]. - International comparable sales increased by 3.8%, although revenue decreased by 0.2% due to the previous year's extra week and negative foreign currency impacts [64]. Company Strategy and Development Direction - The company aims to strengthen its position as a leading omnichannel destination for technology, focusing on improving customer experiences and launching new profit streams such as Best Buy Marketplace and Best Buy Ads [19][40]. - Fiscal '26 priorities include enhancing omnichannel experiences, scaling new profit streams, and driving operational effectiveness to offset pressures [19][50]. - The company plans to leverage AI for improved digital experiences and enhance physical store merchandising while closing less profitable locations [32][36]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about consumer resilience despite high inflation, anticipating flat to slightly up growth in the U.S. consumer electronics industry [22]. - The company expects comparable sales growth in the range of flat to 2% for the year, with growth weighted more in the second half due to product launches [23]. - Management acknowledged the potential impact of tariffs on pricing and consumer behavior, emphasizing the need for strategic navigation in a volatile environment [25][121]. Other Important Information - The company recorded a goodwill impairment charge of $475 million related to Best Buy Health, which is excluded from adjusted earnings [66]. - Capital expenditures for fiscal '25 were $706 million, down from $795 million in fiscal '24, reflecting a reduction in store-related investments [67]. - The quarterly dividend was increased to $0.95 per share, marking the 12th consecutive year of dividend increases [68]. Q&A Session Summary Question: Impact of tariffs on pricing and sales - Management indicated that the 10% tariff from China could result in a negative impact of approximately 1 point on comparable sales, with potential price increases depending on vendor actions and consumer reactions [77][80]. Question: Flexibility in supply chain regarding tariffs - Management highlighted their experienced team and ongoing communication with vendors to navigate supply chain adjustments and mitigate tariff impacts [95][97]. Question: Comparison of company performance to industry growth - Management stated that for Q4, the company's market share was flattish compared to last year, with notable share gains in computing and gaming categories [132][134].

Best Buy surpassed earnings expectations for its fourth quarter, but faced challenges in its health division.Best Buy (BBY -3.53%), a leading consumer electronics retailer, reported its fourth-quarter results on March 4, 2025.The company outperformed analyst estimates with an adjusted earnings per share (EPS) of $2.58 against a forecast of $2.40. Revenue came in at $13.95 billion, surpassing the expected $13.68 billion. This positive performance was driven by strong holiday sales, particularly in the comput ...

A man walks by the front of a Best Buy store at American Dream Mall on November 29, 2024 in East Rutherford City.Best Buy on Tuesday posted fourth-quarter earnings and revenue that topped expectations, but CEO Corie Barry projected that prices for U.S. consumers would rise as President Donald Trump's tariffs on China and Mexico go into effect.On Best Buy's earnings call, Barry said China and Mexico are the company's top two supply-chain sources."Trade is critically important to our business and industry, th ...

Best Buy Co. Inc.’s stock erased early gains to trade down 2.8% premarket Tuesday, after the electronics retailer blew past estimates for the fourth quarter and raised its quarterly dividend by 1%, but flagged continued pressure on consumers will hurt sales.Best Buy is expecting fiscal 2026 to show consumer behavior largely similar to that seen in fiscal 2025, namely with its customers remaining resilient but still dealing with high inflation “that is driving expenses up across their lives,” Chief Financial ...

GAAP Diluted EPS of $0.54 Included a Goodwill Impairment of ($2.02) Adjusted* Diluted EPS of $2.58 Exhibit 99 Best Buy Reports Fourth Quarter Results Comparable Sales Increased 0.5% Increasing Quarterly Dividend 1% to $0.95 per Share Expects FY26 Adjusted* Diluted EPS of $6.20 to $6.60 MINNEAPOLIS, March 4, 2025 -- Best Buy Co., Inc. (NYSE: BBY) today announced results for the 13-week fourth quarter ended February 1, 2025 ("Q4 FY25"), as compared to the 14-week fourth quarter ended February 3, 2024 ("Q4 FY2 ...

Earnings Overview - The focus on earnings continues in the retail sector, with major companies like Target, Best Buy, and Costco set to report results this week [1] - Recent earnings releases indicate stable consumer spending trends, despite a slight pullback in consumer confidence [2] Consumer Spending Trends - Accumulated inflation has negatively impacted consumer spending, particularly among lower-income groups, leading to a focus on essentials rather than discretionary goods [3] - Spending on consumer durable goods has been weak, with expectations for confirmation of this trend in upcoming reports from Target and Best Buy [3] Company-Specific Insights - Target is expected to report earnings of $2.24 per share on revenues of $30.77 billion, reflecting year-over-year declines of -24.8% and -3.6% respectively, with same-store sales expected to rise by +1.2% [6] - Best Buy is projected to report EPS of $2.39 on revenues of $13.65 billion, representing year-over-year changes of -12.1% and -6.8%, with a decline in same-store sales expected at -1.54% [8] - Costco is anticipated to report earnings of $4.09 per share on revenues of $63.2 billion, showing year-over-year increases of +10.2% and +63.2% respectively, with strong growth expected to continue [14] Retail Sector Performance - The retail sector has seen a total Q4 earnings increase of +32.2% year-over-year among 26 retailers, with 73.1% beating EPS estimates [16] - The overall earnings growth in the retail sector is significantly influenced by Amazon, which reported a Q4 earnings increase of +86.9% [18][19] Future Outlook - Best Buy's revenues are expected to decline to $41.2 billion in 2024, down -5.1% from the previous year, but a growth in revenues is anticipated in the following year [11][12] - Costco's growth is supported by a loyal customer base and strong same-store sales, indicating a positive outlook for the company [13]