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| Best Buy Reports December Revenue of $7.5 Billion, Continues Market Share Gains |
Company Updates Fiscal 2009 Annual EPS Guidance Range
Monthly Revenue Summary - Fiscal December
(U.S. dollars in billions)
Fiscal December 2009 Fiscal Fiscal
December 2009 December 2008
Revenue Revenue Change Comparable Store Comparable Store
Sales Change1 Sales Change1
Total Company $7.5 4% (6.5%) 1.5%
Domestic Segment $5.9 (1%) (6.8%) 0.3%
International $1.6 29%2 (4.2%) 7.6%
Segment
1 Comprised of revenue at stores, call centers and Web sites operating for at
least 14 full months, as well as remodeled and expanded locations. Relocated
stores are excluded from the comparable store sales calculation until at
least 14 full months after reopening. Acquired stores are included in the
comparable store sales calculation beginning with the first full quarter
following the first anniversary of the date of the acquisition. The
calculation of the comparable store sales change excludes the effect of
fluctuations in foreign currency exchange rates. The method of calculating
comparable store sales varies across the retail industry. As a result,
In commenting on fiscal December's revenue results,
The company's domestic segment generated
The company's international segment increased its fiscal December
revenue by 29 percent to
U.S. Performance of Flat-Panel TVs, Notebooks and Mobile Phones Remains Strong
Domestic Revenue Mix Summary Domestic Comparable Store Sales
Change
Fiscal Month Ended Fiscal Month Ended
Revenue Category Jan. 3, 2009 Jan. 5, 2008 Jan. 3, 2009 Jan. 5, 2008
Consumer 44% 46% (8.7%) (4.4%)
Electronics
Home Office 24% 21% 6.5% 4.1%
Entertainment 25% 26% (12.2%) 7.4%
Software
Appliances 3% 3% (24.5%) (3.4%)
Services 4% 4% (0.5%) (2.1%)
Other <1% <1% n.a. n.a.
Total 100% 100% (6.8%) 0.3%
The home office revenue category, which accounted for 24 percent of
fiscal December domestic revenue, posted a comparable store sales gain
of 6.5 percent. This growth was driven primarily by very strong
double-digit comparable store sales growth in mobile phones and
accessories. Total connections increased by the solid double digits. In
the prior year's period, only 181 U.S. The services revenue category, which comprised 4 percent of fiscal December domestic revenue, posted a 0.5-percent comparable store sales decrease for the month. Consumer electronics, which represented 44 percent of fiscal December domestic revenue, posted an 8.7-percent comparable store sales decline. The total television category posted a high single-digit comparable store sales gain, while flat-panel TVs showed low double-digit comparable store sale increases on even stronger unit growth. The strength in televisions was more than offset by comparable store sales declines in digital cameras and MP3 players, which experienced a reduction in consumer demand during the month. In addition, GPS products had significant declines in average selling prices, which more than offset strong double-digit unit increases. The entertainment software revenue category, which comprised 25 percent of fiscal December domestic revenue, experienced a comparable store sales decline of 12.2 percent. Music and movies experienced double-digit comparable store sales declines. Video gaming comparable store sales declined by the mid single digits, primarily due to a shift toward software and reduced sales of large-ticket consoles, as well as comparisons with strong results in the prior year's period. The appliances revenue category, which accounted for 3 percent of fiscal December domestic revenue, declined by 24.5 percent on a comparable store sales basis. The decline was driven primarily by continued weakness in purchases of major appliances. Year-to-Date Revenue Rises 12 Percent
For the first 10 months of fiscal 2009, Company Updates Fiscal 2009 Annual EPS Guidance Range
In mid-December, the company announced a voluntary separation package
available to nearly all corporate employees in order to reduce future
non-customer facing expenses. Based on the number of employees who
accepted the offer, the company expects to recognize in its fiscal
fourth quarter a charge of approximately Commenting on the updated earnings range, Jim Muehlbauer, executive vice president and chief financial officer, said, "Given the expected volatility in consumer spending over the holiday shopping season, we prepared plans that reflected a wide range of potential outcomes. Our employees did an outstanding job of execution and truly focused on solving customers' problems. They delivered revenue results for December that both were in line with our expected range, and reflected strong market share gains. December revenue trends improved as the month progressed, and we were pleased with the effectiveness with which we managed our promotions. While we have limited visibility to consumer spending patterns in the post-holiday period, we feel confident in narrowing the range of our annual EPS guidance, given the proportion of the year that is behind us."
On
Forward-Looking and Cautionary Statements:
This news release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995 as contained in
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934 that reflect management's current views
and estimates regarding future market conditions, company performance
and financial results, business prospects, new strategies, the
competitive environment and other events. You can identify these
statements by the fact that they use words such as "anticipate,"
"believe," "estimate," "expect," "intend," "project," "plan," "outlook,"
and other words and terms of similar meaning. These statements involve a
number of risks and uncertainties that could cause actual results to
differ materially from the potential results discussed in the
forward-looking statements. Among the factors that could cause actual
results and outcomes to differ materially from those contained in such
forward-looking statements include the following: general economic
conditions, acquisitions and development of new businesses,
divestitures, product availability, sales volumes, pricing actions and
promotional activities of competitors, profit margins, weather, changes
in law or regulations, foreign currency fluctuation, availability of
suitable real estate locations, the company's ability to react to a
disaster recovery situation, the impact of labor markets and new product
introductions on overall profitability, failure to achieve anticipated
benefits of announced transactions and integration challenges relating
to new ventures. A further list and description of these risks,
uncertainties and other matters can be found in the company's annual
report and other filings made from time to time with the
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