The stock is down 27.6% in early trading following a company report showing that its efforts to match the prices of competitors including Wal-mart and Amazon backfired over the holidays. Sales at stores open at least a year fell 0.9% in the nine weeks ending January 4; they had been flat in the same period last year. Total company revenues fell 2.6% to $11.45B. Domestically, declines in sales of cameras, DVD and Blu-ray discs, and MP3 players outweighed increased spending for computers, appliances, and gaming. The weak results mean that Q4 operating income likely will come in as much as 185 basis points below last year’s, CEO Hubert Joly says. He says there’s a silver lining: By matching prices from online rivals, and improving the shopping experience, Best Buy saw “a market share gain in an industry that NPD says declined 240 basis points during the holiday period.” The chain’s online sales were +23.5% vs last year. That leaves the retailer “well-positioned as we enter fiscal 2015.” Investors had high hopes for Best Buy. Its stock price appreciated 156% in the 12 months ending yesterday, before the disappointing news.
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This article was printed from http://www.deadline.com/2014/01/best-buy-shares-hammered-after-it-reports-disappointing-holiday-sales/
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