Best Buy's stock experienced a drop in premarket trading on Tuesday as the company reported revenue that fell short of expectations and lowered its fiscal-year guidance. Despite posting adjusted earnings of $1.29 per share, surpassing forecasts for $1.19, Best Buy's revenue stood at $9.8 billion, a 7.8% decrease from the previous year. Analysts had predicted revenue to reach $9.9 billion.
The company also reported a 6.9% decline in same-store sales for the quarter, missing the anticipated 5.7% decline. As a result, Best Buy has revised its guidance for fiscal 2024, projecting revenue between $43.1 billion and $43.7 billion, compared to the previously stated range of $43.8 billion to $44.5 billion. Furthermore, the high end of the earnings per share guidance has been adjusted from $6.40 to $6.30.
Full-year same-store sales are now expected to decrease between 6% and 7.5%, contrary to the earlier outlook of a 4.5% to 6% decline. For the fourth quarter, analysts predicted a 1.1% decrease in same-store sales, however, Best Buy anticipates a decline of 3% to 7%.
Corie Barry, CEO of Best Buy, acknowledged the unpredictable consumer demand in the current macro environment as a reason for revising the company's revenue outlook. Barry stated, "Based on the sales trends in the third quarter and so far in November, we believe it is prudent to lower our annual revenue outlook."
Best Buy's stock declined by 2% to $66.77 in premarket trading, contributing to a year-to-date decrease of 15%.
Sabrina Escobar
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