FILE PHOTO: People wait for purchases outside of a Best Buy store due to the outbreak of coronavirus disease (COVID-19) in Arlington, Virginia, U.S. April 10, 2020. REUTERS/Joshua Roberts/File Photo
November 24, 2020
(Reuters) – Best Buy Co Inc held back from issuing a holiday-quarter forecast on Tuesday, saying it was unsure if a sales boom fueled by demand for remote-work computer equipment was sustainable as the COVID-19 pandemic rages on in the United States.
Shares of the consumer electronic retailer, which has been one of the few retail winners in the health crisis, fell 2.6% before the bell, even as it beat third-quarter sales and profit estimates.
“It is very difficult for us to predict how sustainable these trends will be due to the significant uncertainty related to the various impacts of the pandemic,” Chief Financial Officer Matt Bilunas said.
The company’s caution comes as consumers cut back spending on non-essential products in the absence of government stimulus, raising concerns of a tough holiday season for retailers.
Meanwhile, infections continue to surge across the country, making it difficult for companies to draw up their expectations for the season.
Best Buy’s comparable sales jumped 23% in the third quarter ended Oct. 31, beating expectations of a 14.7% increase, according to IBES data from Refinitiv.
Total revenue rose 21.4% to $11.85 billion a year earlier, above market expectations of about $11 billion.
Net earnings rose to $391 million, or $1.48 per share from $293 million, or $1.10 per share, a year earlier.
Excluding one-time items, the company earned $2.06 per share, beating analysts’ average estimate of $1.70 per share.
Best Buy said it plans to resume share buybacks in the fourth quarter.
(Reporting by Uday Sampath in Bengaluru; Editing by Arun Koyyur)