Best Buy gives cautious sales outlook after holiday

SHARE Best Buy gives cautious sales outlook after holiday

NEW YORK — Best Buy said Thursday its same-store sales in the U.S. climbed during the holiday period but online sales growth slowed, and the retailer cautioned that sales of mobile phones and home theater items will likely not continue at holiday levels.

The company’s stock fell more than 7 percent in premarket trading.

Best Buy said that sales at U.S. stores open at least a year rose 2.6 percent for the nine-week period ended Jan. 3, excluding the benefit of mobile phone installment billing.

Best Buy’s results also exclude revenue from the Five Star business in China, which it previously announced that it is selling.

For online, comparable sales rose 13.4 percent on higher conversion rates and increased traffic. But the growth was slower than the 23.5 percent increase reported in the prior-year period. Best Buy said that this was due to pressure related to last year’s initial rollout of ship-from-store, an industrywide drop in tablet sales and the absence of any big product launches. The prior-year period benefited from the launch of the Xbox One and PS4 gaming consoles.

Executive Vice President, Chief Administrative Officer and Chief Financial Officer Sharon McCollam said in a statement that U.S. sales of mobile phones, home theater items and other consumer electronics goods probably won’t continue at holiday levels. The executive said that the company currently anticipates enterprise comparable sales in the first half of fiscal 2016 to be flat to down low-single digits, excluding the estimated impact of installment billing.

Shares of Best Buy Co. dropped $3.01, or 7.5 percent, to $36.90 about two hours before the market open.

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