Best Buy profit tops Street, helped by cost cutting
MINNEAPOLIS — Best Buy said it earned $266 million in the second quarter, compared with a profit of $12 million in the year-ago period, amid cost cuts. Its results beat Wall Street expectations.
Revenue for the quarter, ended Aug. 3, edged down to $9.3 billion, from $9.34 billion last year. Analysts expected $9.13 billion. Same-store sales fell 0.6%, including a 0.4% decline domestically. Online sales rose 10.5%.
Industry analysts said the chain’s improved performance offered evidence that CEO Herbert Joly’s turnaround plans were starting to bear fruit. Under Joly, the company has put strict cost controls in place, streamlined management, reduced jobs, closed some locations, and announced plans to shed non-core assets, including its stake in a European joint venture with Carphone Warehouse.
At the same time, Best Buy has entered into agreements with Samsung Electronics and Microsoft to open in-store boutiques in its stores, updated its website and focused more shelf space to “hot” tech products.