New York – Best Buy Co. on Thursday reported a boost in third-quarter profit and sales, but its results and outlook fell short of Wall Street expectations.
The consumer electronics retailer’s shares fell $3.62, or 6.3 percent, to $53.68 in morning trading.
Best Buy has been working to better compete with rivals in an increasingly online shopping world. Like most retailers, it is struggling against Amazon.com and that company’s expansion of services and products.
“As we head into the teeth of the holiday shopping season, the key for Best Buy to maximize its profitability and therefore success will be how well it manages its promotional cadence as Walmart and Amazon continue their heavyweight battle for market share across many categories,” said Moody’s lead retail analyst Charlie O’Shea.
The Richfield, Minnesota-based company’s profit rose 23 percent to $239 million, or 78 cents per share. Revenue rose 4 percent to $9.32 billion. Sales in stores open at least a year, a key measure of a retailer’s health, rose 4.4 percent.
Every figure fell short of expectations, though the company cited the delay of an anticipated new phone launching for sale during the quarter. That trimmed about $100 million of expected revenue, Best Buy said.
The average estimate of 11 analysts surveyed by Zacks Investment Research was for earnings of 79 cents per share, while seven analysts expected $9.35 billion in revenue. Analysts polled by FactSet expected same-store sales to rise 4.9 percent.
For the current quarter ending in January, Best Buy expects its per-share earnings to range from $1.89 to $1.99. Analysts surveyed by Zacks had forecast adjusted earnings per share of $2.03.
The company said it expects revenue in the range of $14.2 billion to $14.5 billion for the fiscal fourth quarter. Analysts surveyed by Zacks had expected revenue of $14.33 billion.
Best Buy expects full-year revenue in the range of $41 billion to $41.3 billion.
Best Buy shares have increased 34 percent since the beginning of the year, while the Standard & Poor’s 500 index has risen 15 percent. The stock has risen 44 percent in the last 12 months.
Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.