Best Buy Co., Inc. (NYSE:BBY) reported a loss in its fiscal 2014 first quarter. The retail chain warned of hurdles ahead for the coming quarter.
Best Buy Earnings Details
The big-box retailer of electronics gear posted adjusted diluted earnings per share of $0.32 and $9.38 billion in revenues. Best Buy posted an EPS of $0.76 on revenues of $10.37 million in the same period a year ago.
Analysts polled by Thomson Reuters estimated first quarter earnings of 25 cents a share on $10.66 billion in revenue.
The Richfield, Minn. retail chain did not provide financial guidance for the second quarter. However Best Buy Co., Inc. (NYSE:BBY)’s CFO Sharon McCollam indicated that the company would continue investments in ‘price competitiveness’, which had taken its toll on the company’s revenues and profits in the first quarter. She emphasized that Best Buy would continue its investments in the second quarter and outlined a laundry list of spending.
Sharon McCollam however warned that Samsung’s in-store impact on its floor space is expected to have operational impacts during the second quarter.
Best Buy’s Chief Executive Hubert Joly, a turnaround specialist hired last year to revive the retailer’s slipping sales, provided rationale for lower sales of the company during the first quarter. He indicated that Best Buy’s domestic first quarter comparable store sales were down by 1.1 percent largely due to the Super Bowl shifting into last year’s fourth quarter, besides the company’s decision to reduce sales in certain non-core businesses.
The retail chain closed 49 U.S. stores and 15 Canadian stores in 2012.
On April 30, Best Buy Co., Inc. (NYSE:BBY) indicated that it entered into a definitive agreement for the sale of its 50 percent interest in Best Buy Europe. Hence the results from European operations are presented as discontinued operations.
Best Buy Co., Inc. (NYSE:BBY) is also taking steps to enhance customers’ experience by upgrading store layouts and beefing up staff training. Besides in March, the retail chain launched a price-matching program aimed at killing showrooming, where shoppers used its big-box stores to view merchandise, but instead buy from online rivals like Amazon.com, Inc. (NASDAQ:AMZN) at a cheaper price.
Outlining his strategy for the future, CEO Hubert Joly indicated that Best Buy Co., Inc. (NYSE:BBY) remains focused on making progress on its Renew Blue priorities announced last November. For the next quarter, the company would focus to complete the deployment of the Samsung Experience Shops and make significant progress in its efforts to optimize the allocation of its retail floor space to more attractive product categories, so as to increase revenue and operating profit per square foot.