NEW YORK (AP) — Best Buy cut its annual outlook for profits and sales after the nation’s largest consumer electronics chain reported a profit decline and stagnating sales for its fiscal first quarter amid shoppers’ worries about the economy and tariffs.
The Minneapolis-based company reported net income of $202 million, or 95 cents per share, for the three-month period ended May 3. That compares with $246 million, or $1.13 per share, a year ago.
Adjusted earnings was $1.15 per share.
Sales fell slightly to $8.77 billion from $8.85 billion.
Analysts were expecting $1.09 per share on sales of $8.81 billion
Comparable sales — those coming from established physical stores and online channels — slipped 0.7% in the quarter. Entertainment products, appliances and consumer electronics took a hit, while the company enjoyed sales growth in computing and mobile devices.
Shares slipped more than 2% in premarket trading on Thursday.
As the last batch of major retailers report first-quarter earnings results this week, winners and losers are emerging at the approach of the critical back-to-school shopping season, which goes into full swing in July.
Many retailers have been grappling with how to manage their business at a time when new tariff developments are happening almost every day.
Walmart, the nation’s largest retailer, got a public scolding from President Donald Trump this month after it said that it has already raised prices on some items and would have to do so again this summer. Trump told the retail giant that it should “eat” the additional costs.
Macy’s trimmed its annual forecast this week, while Target’s sales fell more than expected in the first quarter and warned they will continue to flag this year.
A federal court in New York handed President Trump a big setback Wednesday, blocking his audacious plan to impose massive taxes on worldwide imports.
A three-judge panel of the U.S. Court of International Trade ruled that Trump overstepped his authority when he declared a national emergency to justify the sweeping tariffs.
Trump’s threatened 145% import taxes on Chinese goods were reduced to 30% in a deal announced May 12, with some of the higher tariffs on pause for 90 days. Trump on Friday threatened a 50% tax on all imports from the European Union as well as a 25% tariff on smartphones unless they’re made in America.
On Sunday, however, Trump said that the U.S. will delay implementation of a 50% tariff on goods from the EU until July 9 to negotiate.
Best Buy said Thursday that it now expects annual earnings per share in the range of $6.15 to $6.30. That’s down from the company’s earlier per-share range of $6.20 to $6.60.
Analysts expect $6.13 per share, according to FactSet.
For the year, the company now expects sales between $41.1 billion and $41.9 billion, down from $41.4 billion to $42.2 billion.
Analysts expected $41.38 billion, according to FactSet.
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