Best Buy Q2 2025 Earnings Beat Expectations with Adjusted Sales Forecast of $43.8B-$44.5B

Best Buy navigates a tough consumer spending environment amid shifting market demands

In Q2 2024, Best Buy (BBY) reported earnings that surpassed analyst predictions despite facing a decline in sales as shoppers cut back on electronics and home appliances.

Highlights

• Best Buy posted quarterly earnings of $1.25 per share, beating estimates despite a year-over-year profit decrease.
• Comparable store sales declined 6.2% as demand softened for electronics, appliances, home theater systems, and mobile devices.
• The company revised its full-year revenue forecast to a range of $43.8 billion to $44.5 billion, narrowing previous guidance.

For the quarter ending July 29, Best Buy reported net income of $274 million, down from $306 million in the same period last year, but above the anticipated $1.06 earnings per share. Total revenue fell 7% to $9.58 billion compared to $10.33 billion a year ago.

Sales at stores open for over 14 months dropped 6.2%, reflecting consumer caution in discretionary spending on electronics and related products. However, gains in gaming revenue partially offset these declines. Online sales decreased by over 7%, yet maintained a significant 31% share of total sales.

Domestic gross margins improved to 23.1% from 22%, supported by stronger product margins, growth in membership programs, and increased profitability from health-related initiatives.

Best Buy CEO Corie Barry commented, "Our results exceeded expectations despite ongoing challenges in the consumer electronics sector, influenced by prior demand surges and persistent macroeconomic headwinds."

This trend mirrors a broader slowdown in discretionary spending affecting major retailers like Walmart, Target, and Home Depot. Target experienced its first quarterly sales decline in six years, while Home Depot saw a 2% revenue drop due to reduced purchases of big-ticket items.

Consequently, Best Buy adjusted its annual sales outlook, projecting comparable store sales to decline between 4.5% and 6%, tightening from the previous 3% to 6% range.

Following the earnings release, Best Buy shares rose 6% during midday trading but remain down 2% year-to-date.

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