Best Buy Earnings Concern Shareholders

Is Best Buy turning into an electronics showroom for online retailers? That’s what some experts proclaim as the company’s Nov. 20 quarterly earnings report sorely missed expectations. Best Buy reported a third-quarter net loss of $13 million—4 cents per share—compared to 2011 third-quarter results of $173 million in net earnings, or 47 cents per share. Even excluding restructuring changes, the company’s revenue fell from $11.145 billion last year to just $10.75 billion—a 3-cent per-share loss.

“The results we are reporting today only strengthen our sense of urgency and purpose,” said Best Buy CEO Hubert Joly.

According to CNBC, Best Buy critics say the stores’ sales are dwindling because shoppers not visit Best Buy to look at high-priced electronics items such as HDTVs, then buy them cheaper somewhere else, such as online retailer Best Buy’s earnings report demonstrated strong customer demand at the store for items such as mobile phones, appliances, e-readers and tablet computers, but significantly less for notebook computers, gaming systems and televisions. The company also reported continued decline in same-store sales—the ninth in the past 10 quarters. Stores open at least 14 months saw sales fall an average of 4.3 percent.

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