Best Buy Co., Inc. (BBY) delivered a strong performance in the second quarter, exceeding analysts’ expectations and raising its fiscal 2025 earnings guidance. The company reported adjusted earnings per share (EPS) of $1.34, beating the street view of $1.16. Quarterly sales also surpassed expectations, reaching $9.29 billion compared to the analyst consensus of $9.24 billion.
CEO Corie Barry attributed the strong performance to the company’s Domestic tablet and computing categories, which collectively saw a 6% increase in comparable sales year-over-year. This positive trend in these categories highlights the continued demand for technology products and the company’s ability to capitalize on this growth.
Best Buy’s positive outlook is reflected in its revised fiscal 2025 adjusted EPS outlook, which was raised to $6.10—$6.35 from the previous range of $5.75—$6.20. This adjustment surpasses the current analyst estimate of $6.08. However, the company did lower the high end of its prior revenue outlook to $41.3 billion—$41.9 billion, compared to the previous range of $41.3 billion—$42.6 billion and the analyst estimate of $41.81 billion.
Looking ahead, Best Buy anticipates a slight decline in comparable sales for the third quarter of fiscal 2025, estimating a decrease of approximately 1.0%. The company also expects its adjusted operating income rate to be around 3.7% during this period.
The strong earnings announcement had a positive impact on Best Buy’s stock price, with shares gaining 14.1% to close at $100.18 on Thursday. Following the release, several analysts made changes to their price targets on Best Buy:
* B of A Securities analyst Elizabeth Suzuki maintained an Underperform rating for Best Buy but raised the price target from $70 to $80.
* Loop Capital analyst Anthony Chukumba maintained a Buy rating and raised the price target from $100 to $110.
* Evercore ISI Group analyst Greg Melich maintained an In-Line rating and raised the price target from $90 to $94.
Best Buy’s strong second-quarter performance and revised earnings guidance demonstrate the company’s resilience and ability to navigate a challenging economic environment. While the company expects some slowdown in sales, its commitment to innovation and customer experience positions it well for future growth.
