Best Buy Delivers ‘Better-Than-Expected’ Q1 Results

In an age of e-commerce and Amazon, maintaining near positive year-over-year entertainment retail sales results can be a good thing.

That’s Best Buy’s mindset, which May 24 reported 0.8% decline in entertainment segment same-store sales for the first quarter, ended May 5.

Never mind the entertainment unit, which includes myriad products such as DVD/Blu-ray Disc movies, video game hardware and software, books, music CDs and computer software, generated 11.3% increase in same-store sales during the previous-year period.

That’s because entertainment produced 7% ($589 million) of Best Buy’s $8.4 billion in domestic revenue, which was up from $554 million, or 7% of $7.9 billion in domestic revenue last year.

When combined with comparable sales upticks in consumer electronics (2.9%), computing and mobile phones (10.2%), appliances (13%) and services (7.3%), entertainment’s softness can be ignored.

“We are happy to report better-than-expected top- and bottom-line results for the first quarter,” CEO Hubert Joly said in a statement.“This strong performance was broad-based, with positive comparable sales across all channels, geographies and most of our product categories.”

Joly said top-line strength was the result of continued “healthy consumer confidence” and product innovation in multiple areas of technology.

“Customers are responding positively to the unique experience we provide to them online, in stores and in their homes,” he said.

International entertainment results are a different matter. Same-store entertainment sales dropped 8.3%, compared to a near 15% increase last year.

Entertainment represented 6% ($41.8 million) of Best Buy’s $697 million in foreign revenue, which was down from $43.1 million (7%) in last year’s $616 million in sales.

 

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