Best Buy announces first quarter results! Both revenue and profit decline!

According to foreign media reports, Best Buy announced its first quarter results for fiscal year 23 on May 24. The financial report shows that due to inflation, Best Buy's revenue this quarter fell to $10.65 billion, compared with $11.64 billion in the same period last year. Net profit also fell from $595 million in the same period last year to $341 million.

1. Domestic Income (United States)

Best Buy's domestic revenue for the quarter was $9.89 billion, down 8.7% year-over-year, driven primarily by an 8.5% drop in comparable sales.

Domestic online revenue was $3.06 billion, down 14.9% year-over-year, and accounted for 30.9% of total domestic revenue, down from 33.2% last year.

Domestic gross profit margin was 21.9%, compared with 23.3% in the same period last year.

GAAP-based SG&A (domestic selling, general and administrative expenses) was $1.74 billion, or 17.6% of revenue, compared with $1.84 billion, or 16.9%, in the same period last year.

According to Best Buy, sales in almost all categories declined year-over-year. In addition, the reasons for the low gross margin are: (1) lower service margins, such as the decline in TotalTech membership subscriptions; (2) lower product margins due to increased promotional activities; and (3) higher supply chain costs due to inflation.

2. International Income

International revenue was $753 million, down 5.4% year-over-year, primarily impacted by the closure of operations in Mexico and a 1.4% decrease in comparable sales in Canada.

Gross margin was 24.3% on a GAAP basis, up from 23.7% in the same period last year, and 23.0% on a non-GAAP basis.

GAAP SG&A was $149 million, or 19.8% of international revenue, compared to $152 million, or 19.1% of revenue, in the same period last year.

"As inflation continues, online consumer demand has been weak this quarter and we expect this trend to continue into the second quarter and will not abate in the short term," said Corie Barry, CEO of Best Buy.

Best Buy lowered its annual profit forecast due to falling demand for TVs and computers, predicting fiscal 2023 revenue to be between $48.3 billion and $49.9 billion, compared with its previous forecast of $49.3 billion to $50.8 billion.

Editor ✎ Nicole/

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