Third-quarter sales spark at Best Buy, shares fall on outlook concerns
By Abigail Townsend
Date: Tuesday 23 Nov 2021
(Sharecast News) - Shares in US electronics retailer Best Buy fell sharply on Tuesday despite third-quarter numbers beating expectations.
The retailer reported net earnings of $499m, or $2.00 per share, for the 13 weeks to 30 October, compared to $391m or $1.48 per share a year previously.
Adjusted earnings per share were $2.08, up two cents on last year. Analysts had been expecting adjusted EPS of $1.91.
Net sales rose to $11.91bn from $11.85bn, in contrast to Wall Street expectations, with most analysts predicting a fall to $11.58bn.
Looking to the full year, the retailer upped revenue guidance to between $51.8bn to $52.3bn from an earlier forecast for between $51bn and $52bn.
However, Best Buy expects same-store sales growth in the crucial fourth quarter of between -2% to 1%, below analyst expectations.
By 1400 GMT, shares in the retailer, which have been trading at record highs, were off nearly 15% in pre-market trading.
Demand surged for electronic goods worldwide during the pandemic as people looked to upgrade home technology. But analysts are now concerned that demand will taper and that both the global semiconductor shortage and heightened shipping costs will hamper supply.
Chief financial officer Matt Bilunas said: "We are looking forward to a strong holiday season and believe we are extremely well positioned, with the both the tech customers want and fast and convenient ways to deliver it.
"We are committed to driving initiatives that will deliver future growth."
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