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Best Buy Q2 profit falls 2%

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Revenues at American electricals retailer Best Buy remained stagnant during its second quarter period whilst gross profits were down two per cent year-on-year, results today revealed.

Its international segment, which includes Best Buy Europe – a partnership with phones retailer Carphone Warehouse (CPW), saw overall comparable store sales increase by 4.3 per cent in the three months to August 28th 2011 but entertainment products saw a significant decline in sales of 13.9 per cent compared to last year.

Like-for-like sales across the whole group fell 0.1 per cent year-on-year in Q2 and diluted earnings per share were down by 22 per cent to $0.47 (£0.30).

Brian J. Dunn, CEO of Best Buy, said: “While results in the second quarter and our outlook reflect continued macro challenges to overall consumer spending and lower consumer electronics industry sales, we have made good progress on our key strategic focus areas in this environment.

“Looking forward to the important holiday season, I believe Best Buy is well positioned to bring the benefits of our multi-channel model to our customers and shareholders.”

More details on Best Buy’s performance in the UK during the past quarter will be made available later in the year when CPW releases it Q2 update.

During the three months to the end of June 2011, Best Europe, which operates ten ‘big box’ out-of-town stores across Britain, saw trading decline 4.8 per cent year-on-year and the retailers has had to scale back its ambitious growth plans for this country due to waning consumer demand.

In an interview with Retail Gazette in July, Best Buy UK Managing Director Steve Jensen defended his companies decision to focus on m-commerce and e-tail instead of the 80 stores initially planned for these shores.

Jensen said: “In an environment where the customer wants multichannel why would you want to take on so many bricks and mortar stores?”

Published on Tuesday 13 September by Editorial Assistant

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