The electronics retailer's high flying shares dropped even though quarterly profit and sales rose, and the company raised its revenue forecast. Fred Katayama reports.
Best Buy has turned itself around, bucking the trend of brick-and-mortar retailers. Strong demand for smartphones, smart home, computers and appliances drove quarterly sales at existing stores up nearly 5-and-a-half percent. That, along with rising revenue and profit, beat Wall Street's forecasts. Its sales have now topped expectations in six of the last eight quarters. What's more, the U.S.' largest electronics retailer lifted its annual revenue forecast. Moody's analyst Charlie O'Shea said, "We expect this favorable trend to continue, and Best Buy's outlook for the back half of the year reflects its view that overall momentum will continue to build." Best Buy has spruced up performance by closing poorly performing stores, improving customer service, and matching Amazon.com's low prices. Best Buy shares, which have far outperformed the broader market with a 46 percent gain this year, fell at the market open Tuesday. The company said it could not predict the impact of Hurricane Harvey on its business at this stage.