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Best Buy Jumps Over 12% as Q3 Earnings Top Estimates; Resumes Stock Buyback

Benzinga Real-time News ·  Nov 22, 2022 18:59

  • $Best Buy (BBY.US)$ reported a third-quarter FY23 sales decline of 11.1% year-on-year to $10.59 billion, beating the consensus of $10.31 billion.

  • Domestic revenue decreased 10.8% Y/Y, and International revenue fell 14.9%. Enterprise comparable sales decreased 10.4%.

  • Gross profit fell 16.8% Y/Y to $2.3 billion, with the margin contracting 150 basis points to 22%. Operating income as a percentage of revenue contracted 220 basis points to 3.4%. Operating income for the quarter fell 45.5% to $365 million.

  • Non-GAAP EPS of $1.38 beat the analyst consensus of $1.03.

  • Best Buy held $1.3 billion in cash and equivalents as of October 29, 2022. Cash used by operating activities for the nine months totaled $(108) million.

  • BBY's board of directors has authorized the payment of its regular quarterly cash dividend of $0.88 per common share, payable on January 3, 2023, to shareholders of record on December 13, 2022.

  • "We are updating our FY23 outlook to flow through our better-than-expected Q3 results while keeping our Q4 expectations unchanged," said Matt Bilunas, Best Buy CFO.

  • BBY said it resumed share repurchases in November after pausing during Q2 and now expects to spend approximately $1 billion in share repurchases this year.

  • Outlook: For FY23, the company expects comparable sales to decline by around 10% (prior view 11% decline).

  • It sees the adjusted operating margin to be slightly higher than 4% (prior view approximately 4%).

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