- Today Best Buy Co Inc (NYSE: BBY) reported its second-quarter sales growth. And one of the highlights from the earnings was the biggest quarterly increase in online sales for the company.
Today Best Buy Co Inc (NYSE: BBY) reported its second-quarter sales growth. One of the highlights from the earnings was the biggest quarterly increase in online sales for the company. Online sales for the company increased 242% in the U.S. compared to the same period a year earlier. Specifically, the domestic online revenue was $4.85 billion due to higher conversion rates and increased traffic. This was largely attributed to the shelter-in-place orders associated with the COVID-19 pandemic.
The same-store sales growth was also the highest in two years for the company despite stores only being open by appointment for the first six weeks of the quarter.
Best Buy CFO Matt Bilunas said that the company is not providing financial guidance due to ongoing uncertainty. “However, I would note that we are planning for Q3 sales to be higher compared to last year but likely will not continue at the current quarter-to-date level of approximately 20% growth. Also, as our stores are fully reopened, we are planning for Q3 SG&A expense to be more in line with last year’s third quarter.”
“Enterprise revenue growth was almost 4%, even though our stores were open by appointment only for the first six weeks of the quarter. Products that help people work, learn, connect and cook at home, like computing, appliances and tablets, were the largest drivers of our sales growth for the quarter. Trends across most categories and services improved materially throughout Q2 as we opened our stores more broadly for shopping, especially categories like large appliances and home theater that benefit from more experiential shopping,” said Corie Barry, Best Buy CEO. “Specifically, enterprise sales growth was approximately 16% in the last seven weeks of Q2 after we opened our stores and the strength continued into August, with sales up approximately 20% for the first three weeks of Q3.”
Barry also noted that inventory was limited as several categories saw much more demand than expected. This also cut into the sales growth.
In terms of net income, Best Buy reported $432 million ($1.65 per share) — which is well above $238 million (89 cents per share) a year earlier. And revenue was $9.91 billion compared to $9.54 billion a year earlier. This was much higher than what analysts were expecting.
Due to the pandemic, Best Buy switched over to a curbside-pickup-only model. As of early May, Best Buy started allowing customers to shop only by appointment. And on June 22, nearly all Best Buy stores were reopened without appointment. Plus the company started at-home consultations around that time as well. Around half of the 51,000 employees who were furloughed were brought back as well.
