Best Buy’s optimism on improving demand for electronics was misplaced, an analyst said, after the appliances and gadgets retailer’s annual net earnings fell amid lower sales.
The company’s net earnings fell 12.5 per cent to $1.24 billion while revenue declined 6.1 per cent to $43.45 billion last fiscal year.
Enterprise segment revenue slid 6.1 per cent to $43.5 million while domestic segment revenue went down 6.3 per cent to $40.1 million and international segment revenue slipped 4.3 per cent to $3.4 million.
“The electronics market continues to be in recession as consumers shun big-ticket purchases because of pressures on their finances,” said GlobalData MD Neil Saunders.
“A weak housing market where moving activity remains suppressed is also problematic, not least because many households cannot use the excuse of moving to upgrade appliances and products like televisions. A relatively weak release cycle of new products is also unhelpful.”
Saunders said Best Buy should step up in its game and make its physical and online stores attractive to customers.
For the current fiscal year, the company forecasts revenue of $41.3 billion to $42.6 billion.
“As we enter FY25, we are energized about delivering on our purpose to Enrich Lives through Technology in our vibrant, always changing industry,” said Best Buy CEO Corie Barry.
“In what we expect to be a year of increasing industry sales stabilization, we are focused on sharpening our customer experiences and industry positioning while maintaining, if not expanding, our operating income rate on a 52-week basis.”
