The Big Story Blog

Best Buy's so-so Christmas better than analysts thought?

Posted at 10:21 AM on January 6, 2012 by Paul Tosto
Filed under: Economy

bestbuy1500.jpg
(PAUL J. RICHARDS/AFP/Getty Images)

MPR News reporter Martin Moylan is writing today on Best Buy. Here's his report from the company's news this morning that revenues were flat for December.

Richfield-based Best Buy didn't have a very good Christmas but it was better than last year's.

Last month, the consumer electronics retailer saw about a one percent drop in sales at stores open at least 14 months. But in the same month last year, so-called same-store sales fell four percent.

Same-store sales is a key gauge of a retailer's financial health because it excludes stores that open or close during the year. At Best Buy, the measure also includes online sales.

Despite the drop in sales, Best Buy stock is up about two percent in early trading. Edward Jones retail analyst Matt Arnold says that's because Wall Street expected a steeper sales decline.

"It's all about expectations," he said. "There's a lot of pessimism as we all know surrounding this story. So, sometimes less bad is enough to make a stock work favorably. And this is definitely evidence of that."

December is a crucial month for retailers since the holiday period can account for a third or more of annual sales.

Despite the sales decline last month, Best Buy reaffirmed its profit forecast (on an adjusted basis)of $3.35 to $3.65 per share for the full fiscal year. Best Buy reports its full-year financial performance March 29th.

December is a crucial month for retailers since the holiday period can account for a third or more of annual sales.

Best Buy says tablet computers, smart phones, appliances and e-readers were strong sellers last month. But TVs, digital cameras and video consoles and games were weaker.


About Paul Tosto

Paul Tosto

Paul Tosto writes the Big Story Blog for MPR News. He joined the newsroom in 2008 after more than 20 years reporting on education, politics and the economy for news wires and newspapers across the country.