Best Buy announces weak 2nd quarter results

GAAP net earnings from continuing operations for the 2nd quarter were $12 million, or $0.04 per diluted share,compared to net earnings from continuing operations of $150 million, or $0.39 per diluted share for the prior-year period. Domestic sales shrank 2.2 percent to US$ 7.8 billion driven by declines in gaming within the Entertainment revenue category, digital imaging and televisions within the Consumer Electronics revenue category and notebooks within the Computing and Mobile Phones revenue category. These declines were partially offset by comparable store sales growth in tablets and mobile phones within the Computing & Mobile Phones revenue category, the Appliances revenue category, and eReaders within the Consumer Electronics revenue category. The Domestic segment online channel revenue grew 14 percent compared to the prior-year period.

As for the full year outlook, Best Buy said it has reduced its annual earnings expectations due to lowered expectations for industry wide sales and the uncertainty associated with several key product launches expected in the second half of the current fiscal year. In addition, the company just announced a new CEO who will start in early September. Given these factors, Best Buyy does not intend to further provide or update earnings guidance for the fiscal year, the company said, adding it continues to expect to achieve its domestic market share goals for the fiscal year and expects to generate free cash flow5 in the range of $1.25 billion to $1.5 billion for fiscal 2013.