Minneapolis, MN—Best Buy Co. announced revenue results for the nine weeks ended January 3, 2015, as compared to the nine weeks ended January 4, 2014, excluding revenue from the Five Star business in China that the company entered into a definitive agreement to sell. Best Buy’s domestic revenue of $10.13 billion increased 4.1% versus last year.
Hubert Joly, Best Buy president and CEO, commented, “In the holiday period, we delivered $11.4 billion in Enterprise revenue, reflecting a 2.6% domestic comparable sales increase, excluding the 80-basis point estimated benefit of installment billing. A compelling merchandise assortment, strong multi-channel execution, and a more favorable year-over-year macroeconomic environment drove these better-than-expected results. We were also able to capitalize on the product cycles in large-screen televisions and mobile phones. These two categories were the primary drivers of our year-over-year revenue growth, more than offsetting significant weakness in tablets.
“Our value proposition of ‘Expert Service, Unbeatable Price’ resonated with customers, whether they came to us in-store, online or both,” Joly added. “We delivered to our customers a strong multi-channel experience and we were uniquely positioned to serve them through our online experience, our national retail footprint, our knowledgeable Blue Shirts and Geek Squad agents, and our stores-within-a-store.
“In the online channel, comparable sales grew 13.4% driven by higher conversion rates and increased traffic. Similar to previous quarters, more than half of the sales growth was shipped from our stores. As expected, the holiday growth rate was lower than previous quarters due to the 600-basis points of pressure that we outlined last quarter relating to last year’s initial rollout of ship-from-store and the launch of two highly anticipated new gaming consoles. Additionally, it was pressured by this year’s industry-wide declines in tablets—a category with strong online penetration. Altogether, these results reflect the successful delivery of our holiday plan.”
Sharon McCollam, Best Buy’s executive vice president, CAO and CFO, also commented: “As Hubert said, we are pleased with the execution of our holiday plan. Despite the NPD-reported consumer electronics categories being down 3.7%3, we drove positive domestic comparable sales growth, maintained a structured and analytical approach to our promotional strategy and delivered an overall better-than-expected financial result. As such, we are increasing our fourth quarter financial outlook, excluding the Five Star business in China . . .” bestbuy.com
