May 21, 2020
Benefiting from a homebound consumer base due to the coronavirus pandemic, Best Buy May 21 reported a 9.5% increase in domestic entertainment revenue to $554 million for the first quarter (ended May 2). That compared with a 12.7% decline in the previous-year period.
The entertainment segment includes DVD/Blu-ray Disc movies, video game hardware and software, books, music CDs and computer software.
International entertainment sales skyrocketed 58% to $58.2 million, compared with a 14% decline a year ago. The largest comparable domestic sales growth drivers were computing and gaming. These growth drivers were more offset by declines in home theater, mobile phones, digital imaging and services.
Domestic online revenue of $3.34 billion increased 155.4% on a comparable basis due to increased traffic. As a percentage of total domestic revenue, online revenue increased 42.2%, versus 15.4% a year ago.
“In the middle of Q1, we shifted all our stores to a curbside-only operating model and were able to retain approximately 81% of last year’s sales during the last six weeks of the quarter, even though not a single customer set foot in our stores,” CEO Corie Barry said in a statement. “The strong sales retention is a testament to the strength of our multi-channel capabilities and the strategic investments we have been making over the past several years.”
Indeed, domestic revenue dipped slightly to $7.91 billion, from $8.48 billion, with operating income fell 27.5% to $241 million, from $332 million a year ago.
Barry thanked store employees for dealing with “immense change” in a workplace with customers, many of whom she said were scared, frustrated and, occasionally, hostile in COVID-19 environment.
“As challenging as the current situation is, I am certain Best Buy will remain a strong, vibrant company that is well positioned to deliver on our purpose and thrive in a new and different environment,” Barry said. “None of this is possible without [our employee] dedication, and I am truly grateful and feel lucky to be on the team with them.”