Electronics retailer Best Buy has finally bitten the bullet and is undertaking a major layoff. According to the New York Post, quoting unnamed sources at the company’s Richfield headquarters, Best Buy Co., Inc. (NYSE:BBY) is finalizing plans to lay off as many as 2,000 mid-level managers at stores across the country. The Post article goes on to say that while no store closings are currently planned, the electronics retailer "has begun laying off thousands of midlevel managers nationwide as it girds for more competition."
Best Buy Co., Inc. (NYSE:BBY) has declined to comment on the story to date. The company is expected to report fourth quarter earnings tomorrow.
Best Buy consolidation moves
The company sources did say the ongoing job cuts are mainly targeting field managers, rather than store managers or rank and file employees. No further job cuts are planned after this round of layoffs, but that could change over the next few months.
Best Buy Co., Inc. (NYSE:BBY) has slightly more than 1,000 U.S. retail outlets. The struggling company has more than 145,000 employees, with over 8,000 based in its home state of Minnesota.
Best Buy Co., Inc. (NYSE:BBY) also laid off 400 employees at its Richfield corporate headquarters last year. In late 2012, the company closed six of its big-box stores in Minnesota which resulted in the loss of several hundred jobs.
Best Buy CEO committed to cost cutting
After reporting disappointing holiday sales last month, Best Buy Co., Inc. (NYSE:BBY) CEO Hubert Joly promised more cost cutting to reduce “bloated” operations. "One of my middle names is Frugality," Joly told analysts without blinking in January. “This is New Year’s resolution (time), so everyone goes on a diet."
Not surprisingly, Wall Street is welcoming the news of the job cuts, as Best Buy Co., Inc. (NYSE:BBY) is currently trading up $1.04 at $26.86 after the release of the New York Post story.