Best Buy Co. Inc. said sales fell in its second quarter and will likely keep dropping amid weak demand for consumer electronics products.
The downbeat forecast comes as more shoppers purchase electronic gadgets online rather than from big-box retailers.
The company, based in Minneapolis, Minn., said Tuesday that revenue fell 4% from a year earlier to $8.9 billion. Net income fell 45% to $146 million, or 42 cents per share, from $266 million, or 77 cents, a year earlier.
Money from legal settlements boosted profit a year earlier.
Removing such special items, the company's profit was 44 cents per share, up from 32 cents last year. That beat expectations of 31 cents per share in a FactSet analyst survey.
The company sees even more sales declines ahead.
At locations open at least 14 months, sales dropped 2.7% last quarter. Such comparable sales, which include stores, websites and call centers, will likely fall by “the low-single digits” in its fiscal third and fourth quarters, the company said.
Best Buy blamed the forecast on falling sales industry-wide for the televisions, desktop computers and tablets that make up most its revenue. The company also forecast “ongoing softness” for mobile phone sales as consumers hold back ahead of “highly-anticipated new product launches,” like a new iPhone.
The company did make some progress in online shopping. Online sales rose 22% in the second quarter.
Best Buy shares fell $1.74, or 5.45%, to $30.25 in afternoon trading.
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