For more than two years, Best Buy sales have dragged as the consumer electronics industry has been in a multiyear standstill waiting for the next big thing in technology.
This spring, the Richfield-based electronics chain finally may have received a new sales stimulant — artificial intelligence-enhanced Microsoft Copilot+ PCs. That promise, along with a small, better-than-expected profit bump for the spring quarter, led to the biggest one-day jump in the Richfield-based shares since the pandemic began.
Yet, Best Buy‘s obstacles were still apparent Thursday when it reported the 10th straight quarter of same-store sales declines, a reported 6.1% drop for February, March and April. Its total revenue of $8.85 billion was a little lower than Wall Street anticipated.
But Best Buy’s shares, though, closed at $81.55, rising more than 13% after the company said it earned $246 million, or $1.13 a share, which rose less than 1% from the same quarter a year ago. The retailer’s stock price hasn’t climbed that high that fast since March 24, 2020, when it jumped 16.8%.
Best Buy leaders say they are optimistic about the future and are on track to meet the middle range of sales projections of a slight decline to flat growth for the year as the company enters a “ripe timeframe for replacing almost a generation of computing,” Best Buy CEO Corie Barry said on a call with analysts Thursday.
“This is not everyone is lined up at the front door waiting to run in and grab the new computer, but it is enough, like most things in [consumer electronics], where it starts a little bit more premium, has some of the attributes, drives some of the interest and allows us the chance to partner with our vendors to really think differently about how we go to market with a new generation of computing,” she said.
Already the preorders of Copilot devices are slightly outpacing Best Buy’s early expectations, Barry said.
As for Thursday’s big stock surge, investors were likely relieved Best Buy’s sales hadn’t been worse even with some of the economic pressures, said Anthony Chukumba, an analyst at Chicago-based Loop Capital Markets.