Best Buy admits Q4 sales were terrible… just like everyone else

Best Buy

Best Buy shares dropped as much as 3% in pre-market trading Thursday after the company reported fourth-quarter results.

The company reported a 1.5% decline in domestic revenue.

But Best Buy wants shareholders to know that it’s been ugly across the consumer-electronics industry board.

Here’s CEO Hubert Joly in the release (emphasis ours):

In our domestic business, we exceeded our bottom-line expectations due to a well-executed holiday plan, a disciplined promotional strategy, better recovery on returned and clearance product and strong expense management.

While domestic revenue declined 1.5%, it was against a backdrop where the NPD-reported categories were down 5.1%. In addition, we continued to drive significant growth in the online channel — with eCommerce revenue increasing nearly 14% to 15.6% of total Domestic revenue.

As the company explains in a footnote, the NDP Group’s weekly tracking service published February 8, showed that revenues for the consumer-electronics industry fell 5.1% during the three months ended January 30, 2016. Sales of consumer electronic products — from TVs to tablets, and excluding mobile phones — makes up about 65% of Best Buy’s revenues.

Best Buy also noted that it had a hard time selling phones.

“As it relates to Q1 FY17, in the Domestic business, we believe that the softness that we saw in the NPD-tracked categories and mobile phones will continue,” said Sharon McCollam, the company’s executive vice president.

The consumer-electronics giant reported net income of $479 million, or $1.40 a share, which was an 8% drop from the prior year, and higher than analysts had expected.

Quarterly sales fell 4.1% to $13.6 billion, in line with estimates.

Same store sales — at stores open for at least one year — fell 1.7%, more than the 1.3% that analysts had estimated.

Last month, the company reported that a sales decline for the holiday season. And from the forthcoming fiscal year, Best Buy will no longer report its holiday-sales numbers because of how important January is to the overall fourth-quarter results.

Best Buy shares have fallen about 20% over the past 12 months, and are down 3% year-to-date.

h/t @philwahba

NOW WATCH: We tried Shake Shack and In-N-Out side by side, and it’s clear which one is better