MINNEAPOLIS (AP) — Best Buy Co. says that weaker than expected traffic until the week before Christmas and low demand in Canada and Europe put a crimp in its December sales.
The largest U.S. electronics retailer said Friday that revenue in stores open at least two years fell 1.2 percent. The measure is considered a key gauge of a retailer’s financial health because it excludes stores that open or close during the year. That’s an improvement from a 4 percent drop in the same period last year.READ MORE: New Poll Shows Minneapolis Residents Support Charter Amendment Replacing Police
Still, Best Buy reaffirmed its annual guidance. December is a crucial month for retailers since the holiday period can account for up to 40 percent of annual sales. Best Buy is opening smaller stores and beefing up its online presence as it faces tough competition from discounters and online retailers.
“Based on our performance in December we continue to expect to achieve our annual guidance, despite customer traffic that was lower than expected until the last week before Christmas, which resulted in December revenue that was slightly lower than our expectations,” said CEO Brian Dunn.
Citi Investment research analyst Kate McShane said results likely improved during the second half of the month as “it appeared the company tried to be more competitive on price and shoppers delayed purchases until the last moment.”
Tablet computers, smart phones, appliances and e-readers were strong sellers. But TVs, digital cameras and video consoles and games were weaker.READ MORE: Minnesota Apple Orchards Endure Labor Shortage During Peak Season
Total revenue was flat at $8.4 billion. Online revenue rose 26 percent.
Domestically, revenue edged up less than 1 percent to $6.5 billion. But revenue fell nearly 2 percent to $1.9 billion. Revenue in stores open at least two years fell in Canada and Europe.
The company reaffirmed its annual adjusted profit guidance to $3.35 to $3.65 per share. Analysts expect $3.41 per share.
Shares rose 14 cents to $23.58 in premarket trading.MORE NEWS: 'I Laid On The Floor And Just Bawled': Minnesota TikTok Sensation, 79, Overwhelmed By Support After Scooter Breaks
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