Best Buy cuts jobs across the country, after warning of slower sales

Key Points
  • Best Buy is cutting jobs across the country after warnings of slower sales and cutting its forecast.
  • The layoffs come even as the U.S. job market remains strong.
  • Other pandemic beneficiaries, including Walmart and Shopify, have also laid off some workers as they adjust to changes in consumer spending.

In this article

Black Friday shoppers leave a Best Buy store in Washington, DC, on November 26, 20221.
Nicholas Kamm | AFP | Getty Images

Best Buy said on Friday that it is cutting jobs across the country about two weeks after it warned it was seeing weaker sales than expected.

A Best Buy spokeswoman, Carly Charlson, declined to say how many people were affected by the layoffs.

"We're always evaluating and evolving our teams to make sure we're serving our customers," Charlson said. "With an ever-changing macroeconomic environment, including customers shopping more digitally than ever, we have made adjustments to our teams that include eliminating a small number of roles."

The company is still investing in other parts of its business, including health care and home services, as well as filling positions as it gears up for the holiday season. Charlson said the company has more open roles than the number of employees affected by the cuts.

The news was first reported by the Wall Street Journal. It said the retailer has eliminated hundreds of store jobs over the past week, citing people familiar with the matter.

Best Buy had about 105,000 employees in the U.S. and Canada, as of the end of January, compared with the nearly 125,000 employees it had at the same time in 2020, according to financial filings. The company is laying off workers even as the U.S. jobs market remains strong. The unemployment rate fell to 3.5% in July, according to the Bureau of Labor Statistics, and hiring exceeded expectations with nonfarm payrolls rising by 528,000 for the month.

Yet some retailers, which saw significant sales growth during the pandemic, are feeling the whiplash of sharp changes in consumer behavior.

Best Buy already anticipated slower sales after seeing a boom in demand for home theaters, office equipment, kitchen appliances and benefitting from stimulus dollars. Yet in late July, it cut its sales forecast for the second quarter and full year, saying consumers are skipping over big-ticket items as they get hit by inflation.

Walmart, Shopify and Peloton are also laying off workers as sales demand slows. Walmart cut about 200 corporate employees, according to people familiar with the matter. Shopify laid off roughly 1,000 workers. And Peloton said Friday that it is slashing about 780 jobs.

Amazon's workforce has gotten smaller, too, primarily through attrition. The company's headcount shrank by 99,000 people to 1.52 million employees at the end of the second quarter after almost doubling in size during the pandemic.

Best Buy will report its fiscal second-quarter earnings on Aug. 30.