Best Buy holiday sales fall; shares on the downswing
The company's shares are down about 28 percent in pre-market trading due to its difficult holiday season.
Best Buy shareholders woke up to some sobering news on Thursday.
The retailer on Thursday announced its holiday sales for the nine-week period ended January 4, and the results weren't necessarily heartwarming. Best Buy generated $11.5 billion in revenue during the period, down from the $11.8 billion it generated during the same period last year. The company's comparable store sales were down 0.8 percent worldwide year over year; its US-based comparable store sales declined by 0.9 percent.
In the US, Best Buy mustered $9.8 billion in sales compared with the $9.9 billion it generated in the prior year.
Not surprisingly, Best Buy investors are already concerned. As of this writing, the company's shares are down 28 percent in pre-market trading, pushing the stock to $27.20. Best closed the day yesterday at $37.57.
So, what happened? Best Buy blamed the troubles on a number of factors, including competitors offering discounted pricing throughout the holiday season, supply issues on "key products," and perhaps most troubling, "significant store traffic declines between 'Power Week' and Christmas." Best Buy also cited a "disappointing mobile phone market."
Best Buy's issues stand in stark contrast to the gloating Amazon did last month, announcing that it had yet another record holiday-shopping season. Amazon, however, didn't announce sales data.