The pandemic pulled forward demand for goods -- particularly electronics -- by several years. We're now in the payback period and that has led to fewer visits to local electronics shops, including Best Buy.
Here are some comments from the conference call, which is going on now:
- Comp sales in the first few weeks of Q3 have been down 6%
- Company guides to FY comp sales down 4.5-6.0% vs prior guidance of down 3-6%
- "Our industry continues to experience lower consumer demand due to the pandemic pull forward of tech purchases and the shift back into services spend outside the home, like travel and entertainment."
- "TV sales trends improved in Q2 and units returned to growth"
- For holiday season expect consumers to look for great deals and convenience and traffic will be weighted toward promotional events
- Back to school has been slightly better than we expected as we get into Q3
None of this is any surprise to the market, as electronics sales have been soft for awhile. The cuts to guidance weren't as bad as feared and shares of BBY are up 2.8% in the premarket, though still down sharply in the past month.