- Best Buy said its sales grew by 20% in the fiscal second quarter, as people permanently embrace habits like working from home and streaming TV.
- The retailer raised its forecast for the second half of the year, too.
- "There has been a dramatic and structural increase in the need for technology," CEO Corie Barry said in a press release.
Best Buy said Tuesday fiscal second-quarter sales rose nearly 20% as consumers upgraded devices and equipment and permanently embraced habits formed over the past year — from hybrid work to streaming TV shows.
The company's shares closed Tuesday up 8.32% to $121.49.
The consumer electronics retailer raised its outlook for the second half of the fiscal year. It now expects same-store sales to range from flat to down 3% versus a year ago. It previously anticipated a high single-digit decline.
"Over the longer term, we are fundamentally in a stronger position than we expected just two years ago," CEO Corie Barry said in a press release. "There has been a dramatic and structural increase in the need for technology."
Due to the coronavirus pandemic, she said the retailer now serves "a much larger install base of consumer electronics with customers who have an elevated appetite to upgrade due to constant technology innovation and needs that reflect permanent life changes."
She said the company's sales also benefited from strong consumer spending, government stimulus, and higher wages and levels of savings.
Here's what the company did for its fiscal second quarter ended July 31 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $2.98 adjusted vs. $1.85 expected
- Revenue: $11.85 billion vs. $11.49 billion expected
Best Buy's second-quarter net income rose to $734 million, or $2.90 per share, up from $432 million, or $1.65 per share, a year earlier.
Excluding items, it earned $2.98 per share, higher than the $1.85 per share expected by analysts surveyed by Refinitiv.
Net sales rose to $11.85 billion from $9.91 billion a year earlier, outpacing estimates of $11.49 billion.
Sales online and at stores open at least 14 months, a key metric known as same-store sales, grew by 20% versus the year-ago period. That was higher than the 18.1% growth that analysts expected in a StreetAccount survey.
Best Buy said it anticipates revenue will range from $51 billion to $52 billion and same-store sales growth to range from 9% to 11% for the fiscal year — higher than the prior outlook of 3% to 6% growth.
For the fiscal third quarter, it expects revenue to range from $11.4 billion to $11.6 billion and same-store sales to decline between 1% and 3%.
The retailer is lapping an unusual time during the pandemic, when stores were open by appointment only for about half of the quarter. Online sales surged by 242% in the U.S. in the year-ago period — the company's biggest quarterly increase ever — as many shoppers used curbside pickup or had purchases delivered to their homes. Compared with that quarter, online sales in the U.S. declined by 28.1%.
Same-store sales grew by 5.8% in the fiscal second quarter of last year.
Barry pointed out the year-ago quarter's unique factors, but noted that Best Buy's revenue is up by 24% and its operating income has more than doubled compared with the second quarter two years ago, before the pandemic.
Best Buy shares closed Monday at $112.16, bringing the company's market value to $28.09 billion. As of Monday's close, Best Buy shares are up about 12% this year.
Read the company's press release here.