Best Buy Earnings Rise In Strong Q2

For the second quarter ended August 1, Best Buy Co. posted net earnings attributable to the company of $164 million versus $146 million in the year-prior period. GAAP earnings from continuing operations were 46 cents per diluted share versus 39 cents per diluted share in last year's quarter, the company reported, while non-GAAP diluted EPS from continuing operations were 49 cents versus 42 cents in the year-prior period.

Best Buy beat a Thomson Reuter's analyst average estimate of 34 cents.

Comparable store sales gained 2.7%, excluding an estimated benefit from installment billing, according to Best Buy. With that benefit included, comps gained 3.8%.

Revenues were $8.53 billion versus $8.46 billion, the company stated, with domestic segment revenues coming in at $7.88 billion versus $7.59 billion in the year-earlier quarter and international segment revenues coming in at $650 million versus $874 million in last year's period. GAAP operating income in the second quarter as a percentage of revenue was 3.4% versus 2.7% and non-GAAP operating income as a percentage of revenue was 3.4% versus 2.9% in the year-earlier quarter, Best Buy related.

“We believe these better-than-expected second quarter results are affirmation that our strategy of offering advice, service and convenience at competitive prices is paying off," said Hubert Joly, Best Buy chairman and CEO. “Enterprise revenue grew 0.8% to $8.5 billion driven by a 3.9% increase in the domestic segment, partially offset by the impact of the Canadian brand consolidation and 120 basis points of pressure from foreign currency. Better year-over-year performance in the domestic segment drove a 50-basis point increase in the enterprise non-GAAP operating income rate to 3.4% and a 17% increase in non-GAAP diluted EPS to 49 cents."

Joly added, “In the domestic business, our comparable sales increased 2.7%, excluding the impact of installment billing, driven by continued strong performance in major appliances, large screen televisions and mobile phones. Online comparable sales increased 17% as our investments in new capabilities continued to drive increased traffic and higher conversion rates. We also saw industry revenue in the NPD-tracked categories, representing 65% of our revenue, improve from a decline of 5.3% in Q1 to a decline of 1.3% in Q2.”