Best Buy noted a slowdown in coronavirus-caused demand for remote work computer equipment on Thursday, failing to meet sales expectations during the holiday quarter, with its shares dropping 8%.
As the global health crisis increased home offices and forced schools to turn to distance learning, all of this increased sales of laptops, webcams and other computing equipment last year, making Best Buy one of the biggest winners during the pandemic, but the company is still unsure about how vaccine implementation will affect consumer demand and purchasing habits.
Best Buy expects comparable sales for the full year to range from a 2% decline to a 1% rise, compared to expectations for a 1.6% rise according to analysts at Refinitiv.
The company also said that it will close more than 20 of its large stores this year to focus more on sales of its application and website, but it did not reveal how many employees will be affected by this movement, knowing that the company is currently increasing its reliance on part-time employees, adding 2,000 jobs after shedding 5,000 full-time employees this month, and cut its workforce 17% in last year’s fiscal year.
The company stated that customer traffic in its stores decreased by 15% in the fourth quarter due to the increase in cases of coronavirus infections, in addition to the shortage in the supply of new gaming and other devices, which negatively affected the company’s performance.
According to fourth-quarter results, Best Buy’s comparable sales rose 12.6%, but failed to meet expectations, which mentioned a 14.4% increase, and the company’s revenue rose 11.5% to $ 16.94 billion, they also failed to meet analyst expectations of $17.23 billion, while adjusted earnings were $3.48 per share, exceeding expectations of $3.45 per share.