Best Buy revenue falls 4% as store traffic declines

Best Buy Q2 tops expectations

Best Buy reported earnings that beat analysts' expectations on Tuesday, but revenue fell 4 percent due to lower traffic in its brick-and-mortar stores.

After the earnings announcement, the company's shares rose in premarket trading. (Click here to get the latest quote.)

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The company posted second-quarter earnings excluding items of 44 cents per share, up from 32 cents a share in the year-earlier period. Earnings from continuing operations came in at 42 cents a share.

Revenue fell 4 percent to $8.89 billion from $9.30 billion a year ago.

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Analysts had expected Best Buy to report earnings of 31 cents a share on $8.99 billion in revenue, according to a consensus estimate from Thomson Reuters.

Same-store sales were down 2.7 percent in the quarter, while U.S. same-store sales fell 2 percent.

"Like other retailers and as reflected in this quarter's performance, we continued to see a shift in consumer behavior: consumers are increasingly researching and buying online," Hubert Joly, Best Buy president and CEO, said in a statement. "As a result, traffic to our brick-and-mortar stores continued to decline, yet our in-store conversion and online traffic continued to increase due to the execution of our Renew Blue strategy which is in direct alignment with this shift."

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In June, the retailer's board approve a hike of its dividend by 12 percent as a result of what its president and CEO Hubert Joly described as its "improved cash position" and confidence in its business model's ability to generate cash.

With locations in the U.S., China, Canada, and Mexico, Best Buy is the biggest multi-channel consumer electronics retailer worldwide.

While Best Buy shares are down nearly 20 percent year to date, its shares have staged a sharp rebound during the past six months.