Best Buy reported steady fourth-quarter profitability despite a modest decline in holiday sales, as softer industry demand weighed on results.

For the quarter ended January 31, comparable sales slipped 0.8 per cent, though CEO Corie Barry said the company saw improvement over the full year and increased its profit margin.

“We are pleased to report better-than-expected profitability for the fourth quarter,” remarked the CEO.

Barry said the company launched and scaled its US digital Marketplace, significantly expanding product assortment, and grew Best Buy Ads, nearly doubling the number of advertising partners from the prior year.

“I’m incredibly grateful for the hard work, dedication, and resourcefulness of more than 80,000 employees to achieve these results,” he added.

Best Buy’s domestic revenue decreased 1.1 per cent to $12.58 billion where weaknesses in home theater and appliances weighed on performance, partially offset by growth in computing and mobile phones.

Meanwhile, its online revenue declined 2.3 per cent on a comparable basis to $4.91 billion. Online sales accounted for 39 per cent of domestic revenue, compared with 39.5 per cent a year earlier.

Best Buy’s domestic gross profit rate was 20.9 per cent, roughly flat year over year, as higher-margin contributions from Best Buy Ads and the US digital marketplace were offset by lower product margin rates.

The retailer’s international revenue increased 0.5 per cent to $1.24 billion. However, its global gross profit rate declined to 20.5 per cent from 21.4 per cent last year.

Looking ahead, Best Buy expects next fiscal year revenue between $41.2 billion and $42.1 billion with capital expenditures of approximately $750 million.

Matt Bilunas, CFO of Best Buy, said the company is preparing for continued macroeconomic uncertainty.

“Moving forward to FY27, we see momentum in our business,” he said. “We also expect to continue to navigate a mixed macro environment.”

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