Best Buy Reports Fourth Quarter Results
Comparable Sales Increased
GAAP Diluted EPS of
Adjusted* Diluted EPS of
Increasing Quarterly Dividend
Expects FY26 Adjusted* Diluted EPS of
FY25 had 52 weeks compared to 53 weeks in FY24. The company estimates the impact of the extra week in Q4 FY24 added approximately
|
|
|
|
|
|
|
|
|
|
|||
|
Q4 FY25 |
Q4 FY24 |
FY25 |
FY24 |
||||||||
|
(13 weeks) |
(14 weeks) |
(52 weeks) |
(53 weeks) |
||||||||
Revenue ($ in millions) |
|
|
|
|
|
|
|
|
|
|||
Enterprise |
$ |
13,948 |
|
$ |
14,646 |
|
$ |
41,528 |
|
$ |
43,452 |
|
Domestic segment |
$ |
12,715 |
|
$ |
13,410 |
|
$ |
38,238 |
|
$ |
40,097 |
|
International segment |
$ |
1,233 |
|
$ |
1,236 |
|
$ |
3,290 |
|
$ |
3,355 |
|
Enterprise comparable sales % change2 |
|
0.5 |
% |
|
(4.8 |
)% |
|
(2.3 |
)% |
|
(6.8 |
)% |
Domestic comparable sales % change2 |
|
0.2 |
% |
|
(5.1 |
)% |
|
(2.5 |
)% |
|
(7.1 |
)% |
Domestic comparable online sales % change2 |
|
2.6 |
% |
|
(4.8 |
)% |
|
(0.8 |
)% |
|
(7.8 |
)% |
International comparable sales % change2 |
|
3.8 |
% |
|
(1.4 |
)% |
|
(0.5 |
)% |
|
(3.2 |
)% |
Operating Income |
|
|
|
|
|
|
|
|
|
|||
GAAP operating income as a % of revenue |
|
1.6 |
% |
|
3.8 |
% |
|
3.0 |
% |
|
3.6 |
% |
Adjusted1 operating income as a % of revenue |
|
4.9 |
% |
|
5.0 |
% |
|
4.2 |
% |
|
4.1 |
% |
Diluted Earnings per Share ("EPS") |
|
|
|
|
|
|
|
|
|
|||
GAAP diluted EPS |
$ |
0.54 |
|
$ |
2.12 |
|
$ |
4.28 |
|
$ |
5.68 |
|
Adjusted1 diluted EPS |
$ |
2.58 |
|
$ |
2.72 |
|
$ |
6.37 |
|
$ |
6.37 |
|
* Beginning in Q4 FY25, the company renamed all of its non-GAAP financial measures to adjusted financial measures; for example, non-GAAP SG&A has been renamed to adjusted SG&A. The methodology for calculating these measures remains unchanged, and therefore any previously reported non-GAAP financial measures that are renamed to corresponding adjusted financial measures remain unchanged. For GAAP to non-GAAP reconciliations of the adjusted measures used throughout this release, please refer to the attached supporting schedule. |
“I am pleased to report better-than-expected sales for the fourth quarter driven by strong growth in computing as well as improved sales performance in other categories,” said Corie Barry, Best Buy CEO. “We also delivered a better-than-expected adjusted operating income rate for the holiday quarter.”
“We are proud of our execution and the momentum we built in FY25,” Barry continued. “We are excited to build on that momentum to bring our FY26 strategy to life while we continue to navigate uncertain circumstances. We are focused on strengthening our position in retail as the leading omni-channel destination for technology and expanding our operating income rate while building and scaling incremental profit streams, including Best Buy Marketplace and Best Buy Ads, that we believe will drive robust returns in the future.”
FY26 Financial Guidance
Matt Bilunas, Best Buy CFO said, “As we enter FY26, we believe consumer behavior will be largely similar to last year – remaining resilient but still dealing with high inflation that is driving expenses up across their lives, making them value focused and thoughtful about big ticket purchases. And, at the same time, we continue to see a consumer that is willing to spend on high price point products when they need to or when there is technology innovation. This leads to our comparable sales guide in the range of flat to
Bilunas continued, “For Q1 FY26, we expect comparable sales to be slightly down to last year and our adjusted operating income rate to be approximately
Best Buy’s guidance for FY26 is the following:
-
Revenue of
to$41.4 billion $42.2 billion -
Comparable sales2 of
0.0% to2.0% -
Enterprise adjusted1 operating income rate3 of
4.2% to4.4% -
Adjusted1 effective income tax rate3 of approximately
25.0% -
Adjusted1 diluted EPS3 of
to$6.20 $6.60 -
Capital expenditures of
to$700 million $750 million
Note: The above FY26 guidance does not include the impact of recently implemented or proposed tariffs.
Domestic Segment Q4 FY25 Results
Domestic Revenue
Domestic comparable sales increased
From a merchandising perspective, the largest drivers of the comparable sales increase on a weighted basis were computing, tablets and services. These drivers were partially offset by declines in the appliances, home theater and gaming categories.
Domestic online revenue of
Domestic Gross Profit Rate
Domestic gross profit rate was
Domestic Selling, General and Administrative Expenses (“SG&A”)
Domestic GAAP SG&A expenses were
International Segment Q4 FY25 Results
International Revenue
International comparable sales increased
International Gross Profit Rate
International gross profit rate was
International SG&A
International SG&A expenses were
Goodwill Impairment
During Q4 FY25, the company recorded a pre-tax non-cash goodwill impairment charge of
Income Taxes
The Q4 FY25 effective tax rate was
Share Repurchases and Dividends
In Q4 FY25, the company returned a total of
Today, the company announced its board of directors approved a
Conference Call
Best Buy is scheduled to conduct an earnings conference call at 8:00 a.m. Eastern Time (7:00 a.m. Central Time) on March 4, 2025. A webcast of the call is expected to be available at www.investors.bestbuy.com, both live and after the call.
Notes:
(1) Beginning in Q4 FY25, the company renamed all of its non-GAAP financials measures to adjusted financial measures; for example, non-GAAP SG&A has been renamed to adjusted SG&A. The methodology for calculating these measures remains unchanged, and therefore any previously reported non-GAAP financial measures that are renamed to corresponding adjusted financial measures remain unchanged. For GAAP to non-GAAP reconciliations of the adjusted measures used throughout this release, please refer to the attached supporting schedule.
(2) The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods. For additional information on comparable sales, please see our most recent Annual Report on Form 10-K, and our subsequent Quarterly Reports on Form 10-Q, filed with the Securities and Exchange Commission (“SEC”), and available at www.investors.bestbuy.com.
(3) A reconciliation of the projected adjusted operating income rate, adjusted effective income tax rate, and adjusted diluted EPS, which are forward-looking non-GAAP financial measures, to the most directly comparable GAAP financial measures, is not provided because the company is unable to provide such reconciliation without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. These GAAP measures may include the impact of such items as restructuring charges; price-fixing settlements; goodwill and intangible asset impairments; gains and losses on sales of subsidiaries and certain investments; amortization of definite-lived intangible assets associated with acquisitions; certain acquisition-related costs; and the tax effect of all such items. Historically, the company has excluded these items from non-GAAP financial measures. The company currently expects to continue to exclude these items in future disclosures of non-GAAP financial measures and may also exclude other items that may arise (collectively, “non-GAAP adjustments”). The decisions and events that typically lead to the recognition of non-GAAP adjustments, such as a decision to exit part of the business or reaching settlement of a legal dispute, are inherently unpredictable as to if or when they may occur. For the same reasons, the company is unable to address the probable significance of the unavailable information, which could be material to future results.
Forward-Looking and Cautionary Statements:
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify these statements by the fact that they use words such as "anticipate," “appear,” “approximate,” "assume," "believe," “continue,” “could,” "estimate," "expect," “foresee,” "guidance," "intend," “may,” “might,” "outlook," "plan," “possible,” "project" “seek,” “should,” “would,” and other words and terms of similar meaning or the negatives thereof. Such statements reflect our current views and estimates with respect to future market conditions, company performance and financial results, operational investments, business prospects, our operating model, new strategies and growth initiatives, the competitive environment, consumer behavior and other events. These statements involve a number of judgments and are subject to certain risks and uncertainties, many of which are outside the control of the Company, that could cause actual results to differ materially from the potential results discussed in such forward-looking statements. Readers should review Item 1A, Risk Factors, of our most recent Annual Report on Form 10-K, and any updated information in subsequent Quarterly Reports on Form 10-Q, for a description of important factors that could cause our actual results to differ materially from those contemplated by the forward-looking statements made in this release. Among the factors that could cause actual results and outcomes to differ materially from those contained in such forward-looking statements are the following: macroeconomic pressures in the markets in which we operate (including but not limited to recession, inflation rates, fluctuations in foreign currency exchange rates, limitations on a government’s ability to borrow and/or spend capital, fluctuations in housing prices, energy markets, jobless rates and effects related to the conflicts in
BEST BUY CO., INC. CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS ($ and shares in millions, except per share amounts) (Unaudited and subject to reclassification) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||
|
February 1, 2025 |
|
February 3, 2024 |
|
February 1, 2025 |
|
February 3, 2024 |
||||||||
Revenue |
$ |
13,948 |
|
|
$ |
14,646 |
|
|
$ |
41,528 |
|
|
$ |
43,452 |
|
Cost of sales |
|
11,030 |
|
|
|
11,645 |
|
|
|
32,143 |
|
|
|
33,849 |
|
Gross profit |
|
2,918 |
|
|
|
3,001 |
|
|
|
9,385 |
|
|
|
9,603 |
|
Gross profit % |
|
20.9 |
% |
|
|
20.5 |
% |
|
|
22.6 |
% |
|
|
22.1 |
% |
Selling, general and administrative expenses |
2,233 |
|
|
|
2,271 |
|
|
|
7,651 |
|
|
|
7,876 |
|
|
SG&A % |
|
16.0 |
% |
|
|
15.5 |
% |
|
|
18.4 |
% |
|
|
18.1 |
% |
Restructuring charges |
|
(7 |
) |
|
|
169 |
|
|
|
(3 |
) |
|
|
153 |
|
Goodwill impairment |
|
475 |
|
|
|
- |
|
|
|
475 |
|
|
|
- |
|
Operating income |
|
217 |
|
|
|
561 |
|
|
|
1,262 |
|
|
|
1,574 |
|
Operating income % |
|
1.6 |
% |
|
|
3.8 |
% |
|
|
3.0 |
% |
|
|
3.6 |
% |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
||||
Gain on sale of subsidiary, net |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
21 |
|
Investment income and other |
|
19 |
|
|
|
37 |
|
|
|
84 |
|
|
|
78 |
|
Interest expense |
|
(13 |
) |
|
|
(14 |
) |
|
|
(51 |
) |
|
|
(52 |
) |
Earnings before income tax expense and equity in income of affiliates |
|
223 |
|
|
|
584 |
|
|
|
1,295 |
|
|
|
1,621 |
|
Income tax expense |
|
106 |
|
|
|
124 |
|
|
|
372 |
|
|
|
381 |
|
Effective tax rate |
|
47.2 |
% |
|
|
21.2 |
% |
|
|
28.7 |
% |
|
|
23.5 |
% |
Equity in income of affiliates |
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
1 |
|
Net earnings |
$ |
117 |
|
|
$ |
460 |
|
|
$ |
927 |
|
|
$ |
1,241 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per share |
$ |
0.55 |
|
|
$ |
2.13 |
|
|
$ |
4.31 |
|
|
$ |
5.70 |
|
Diluted earnings per share |
$ |
0.54 |
|
|
$ |
2.12 |
|
|
$ |
4.28 |
|
|
$ |
5.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
|
||||||
Basic |
|
213.6 |
|
|
|
215.9 |
|
|
|
215.2 |
|
|
|
217.7 |
|
Diluted |
|
215.4 |
|
|
|
216.8 |
|
|
|
216.6 |
|
|
|
218.5 |
|
BEST BUY CO., INC. CONDENSED CONSOLIDATED BALANCE SHEETS ($ in millions) (Unaudited and subject to reclassification) |
|||||||
|
|
|
|
|
|
|
|
|
February 1, 2025 |
|
February 3, 2024 |
||||
Assets |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
1,578 |
|
|
$ |
1,447 |
|
Receivables, net |
|
1,044 |
|
|
|
939 |
|
Merchandise inventories |
|
5,085 |
|
|
|
4,958 |
|
Other current assets |
|
517 |
|
|
|
553 |
|
Total current assets |
|
8,224 |
|
|
|
7,897 |
|
Property and equipment, net |
|
2,122 |
|
|
|
2,260 |
|
Operating lease assets |
|
2,833 |
|
|
|
2,758 |
|
Goodwill |
|
908 |
|
|
|
1,383 |
|
Other assets |
|
695 |
|
|
|
669 |
|
Total assets |
$ |
14,782 |
|
|
$ |
14,967 |
|
|
|
|
|
|
|
|
|
Liabilities and equity |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
Accounts payable |
$ |
4,980 |
|
|
$ |
4,637 |
|
Unredeemed gift card liabilities |
|
253 |
|
|
|
253 |
|
Deferred revenue |
|
951 |
|
|
|
1,000 |
|
Accrued compensation and related expenses |
|
464 |
|
|
|
486 |
|
Accrued liabilities |
|
741 |
|
|
|
902 |
|
Current portion of operating lease liabilities |
|
617 |
|
|
|
618 |
|
Current portion of long-term debt |
|
10 |
|
|
|
13 |
|
Total current liabilities |
|
8,016 |
|
|
|
7,909 |
|
Long-term operating lease liabilities |
|
2,282 |
|
|
|
2,199 |
|
Long-term debt |
|
1,144 |
|
|
|
1,152 |
|
Long-term liabilities |
|
532 |
|
|
|
654 |
|
Equity |
|
2,808 |
|
|
|
3,053 |
|
Total liabilities and equity |
$ |
14,782 |
|
|
$ |
14,967 |
|
BEST BUY CO., INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in millions) (Unaudited and subject to reclassification) |
|||||||
|
|
|
|
|
|
||
|
Twelve Months Ended |
||||||
|
February 1, 2025 |
|
February 3, 2024 |
||||
Operating activities |
|
|
|
|
|
||
Net earnings |
$ |
927 |
|
|
$ |
1,241 |
|
Adjustments to reconcile net earnings to total cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
866 |
|
|
|
923 |
|
Restructuring charges |
|
(3 |
) |
|
|
153 |
|
Goodwill impairment |
|
475 |
|
|
|
- |
|
Stock-based compensation |
|
139 |
|
|
|
145 |
|
Deferred income taxes |
|
(59 |
) |
|
|
(214 |
) |
Gain on sale of subsidiary, net |
|
- |
|
|
|
(21 |
) |
Other, net |
|
12 |
|
|
|
26 |
|
Changes in operating assets and liabilities: |
|
|
|
||||
Receivables |
|
(111 |
) |
|
|
204 |
|
Merchandise inventories |
|
(155 |
) |
|
|
178 |
|
Other assets |
|
11 |
|
|
|
(18 |
) |
Accounts payable |
|
358 |
|
|
|
(1,025 |
) |
Income taxes |
|
(212 |
) |
|
|
52 |
|
Other liabilities |
|
(150 |
) |
|
|
(174 |
) |
Total cash provided by operating activities |
|
2,098 |
|
|
|
1,470 |
|
|
|
|
|
|
|
||
Investing activities |
|
|
|
|
|
||
Additions to property and equipment |
|
(706 |
) |
|
|
(795 |
) |
Purchases of investments |
|
(26 |
) |
|
|
(9 |
) |
Net proceeds from sale of subsidiary |
|
- |
|
|
|
14 |
|
Sales of investments |
|
20 |
|
|
|
7 |
|
Other, net |
|
8 |
|
|
|
2 |
|
Total cash used in investing activities |
|
(704 |
) |
|
|
(781 |
) |
|
|
|
|
|
|
||
Financing activities |
|
|
|
|
|
||
Repurchase of common stock |
|
(500 |
) |
|
|
(340 |
) |
Issuance of common stock |
|
17 |
|
|
|
19 |
|
Dividends paid |
|
(807 |
) |
|
|
(801 |
) |
Repayments of debt |
|
(17 |
) |
|
|
(19 |
) |
Other, net |
|
(2 |
) |
|
|
(3 |
) |
Total cash used in financing activities |
|
(1,309 |
) |
|
|
(1,144 |
) |
|
|
|
|
|
|
||
Effect of exchange rate changes on cash and cash equivalents |
|
(10 |
) |
|
|
(5 |
) |
Increase (decrease) in cash, cash equivalents and restricted cash |
|
75 |
|
|
|
(460 |
) |
Cash, cash equivalents and restricted cash at beginning of period |
|
1,793 |
|
|
|
2,253 |
|
Cash, cash equivalents and restricted cash at end of period |
$ |
1,868 |
|
|
$ |
1,793 |
|
BEST BUY CO., INC. SEGMENT INFORMATION ($ in millions) (Unaudited and subject to reclassification) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||
Domestic Segment Results |
February 1, 2025 |
|
February 3, 2024 |
|
February 1, 2025 |
|
February 3, 2024 |
||||||||
Revenue |
$ |
12,715 |
|
|
$ |
13,410 |
|
|
$ |
38,238 |
|
|
$ |
40,097 |
|
Comparable sales % change |
|
0.2 |
% |
|
|
(5.1 |
)% |
|
|
(2.5 |
)% |
|
|
(7.1 |
)% |
Comparable online sales % change |
|
2.6 |
% |
|
|
(4.8 |
)% |
|
|
(0.8 |
)% |
|
|
(7.8 |
)% |
Gross profit |
$ |
2,654 |
|
|
$ |
2,742 |
|
|
$ |
8,647 |
|
|
$ |
8,850 |
|
Gross profit as a % of revenue |
|
20.9 |
% |
|
|
20.4 |
% |
|
|
22.6 |
% |
|
|
22.1 |
% |
SG&A |
$ |
2,039 |
|
|
$ |
2,069 |
|
|
$ |
7,021 |
|
|
$ |
7,236 |
|
SG&A as a % of revenue |
|
16.0 |
% |
|
|
15.4 |
% |
|
|
18.4 |
% |
|
|
18.0 |
% |
Operating income |
$ |
147 |
|
|
$ |
512 |
|
|
$ |
1,154 |
|
|
$ |
1,467 |
|
Operating income as a % of revenue |
|
1.2 |
% |
|
|
3.8 |
% |
|
|
3.0 |
% |
|
|
3.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Domestic Segment Non-GAAP Results* |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Adjusted gross profit |
$ |
2,654 |
|
|
$ |
2,742 |
|
|
$ |
8,647 |
|
|
$ |
8,850 |
|
Adjusted gross profit as a % of revenue |
|
20.9 |
% |
|
|
20.4 |
% |
|
|
22.6 |
% |
|
|
22.1 |
% |
Adjusted SG&A |
$ |
2,034 |
|
|
$ |
2,064 |
|
|
$ |
7,000 |
|
|
$ |
7,175 |
|
Adjusted SG&A as a % of revenue |
|
16.0 |
% |
|
|
15.4 |
% |
|
|
18.3 |
% |
|
|
17.9 |
% |
Adjusted operating income |
$ |
620 |
|
|
$ |
678 |
|
|
$ |
1,647 |
|
|
$ |
1,675 |
|
Adjusted operating income as a % of revenue |
|
4.9 |
% |
|
|
5.1 |
% |
|
|
4.3 |
% |
|
|
4.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||
International Segment Results |
February 1, 2025 |
|
February 3, 2024 |
|
February 1, 2025 |
|
February 3, 2024 |
||||||||
Revenue |
$ |
1,233 |
|
|
$ |
1,236 |
|
|
$ |
3,290 |
|
|
$ |
3,355 |
|
Comparable sales % change |
|
3.8 |
% |
|
|
(1.4 |
)% |
|
|
(0.5 |
)% |
|
|
(3.2 |
)% |
Gross profit |
$ |
264 |
|
|
$ |
259 |
|
|
$ |
738 |
|
|
$ |
753 |
|
Gross profit as a % of revenue |
|
21.4 |
% |
|
|
21.0 |
% |
|
|
22.4 |
% |
|
|
22.4 |
% |
SG&A |
$ |
194 |
|
|
$ |
202 |
|
|
$ |
630 |
|
|
$ |
640 |
|
SG&A as a % of revenue |
|
15.7 |
% |
|
|
16.3 |
% |
|
|
19.1 |
% |
|
|
19.1 |
% |
Operating income |
$ |
70 |
|
|
$ |
49 |
|
|
$ |
108 |
|
|
$ |
107 |
|
Operating income as a % of revenue |
|
5.7 |
% |
|
|
4.0 |
% |
|
|
3.3 |
% |
|
|
3.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
International Segment Non-GAAP Results* |
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted gross profit |
$ |
264 |
|
|
$ |
259 |
|
|
$ |
738 |
|
|
$ |
753 |
|
Adjusted gross profit as a % of revenue |
|
21.4 |
% |
|
|
21.0 |
% |
|
|
22.4 |
% |
|
|
22.4 |
% |
Adjusted SG&A |
$ |
194 |
|
|
$ |
202 |
|
|
$ |
630 |
|
|
$ |
640 |
|
Adjusted SG&A as a % of revenue |
|
15.7 |
% |
|
|
16.3 |
% |
|
|
19.1 |
% |
|
|
19.1 |
% |
Adjusted operating income |
$ |
70 |
|
|
$ |
57 |
|
|
$ |
108 |
|
|
$ |
113 |
|
Adjusted operating income as a % of revenue |
|
5.7 |
% |
|
|
4.6 |
% |
|
|
3.3 |
% |
|
|
3.4 |
% |
* Beginning in Q4 FY25, the company renamed all of its non-GAAP financial measures to adjusted financial measures; for example, non-GAAP SG&A has been renamed to adjusted SG&A. The methodology for calculating these measures remains unchanged, and therefore any previously reported non-GAAP financial measures that are renamed to corresponding adjusted financial measures remain unchanged. For GAAP to non-GAAP reconciliations, please refer to the attached supporting schedule titled Reconciliation of Non-GAAP Financial Measures. |
BEST BUY CO., INC. REVENUE CATEGORY SUMMARY (Unaudited and subject to reclassification) |
|||||||||||
|
|
|
|
|
|
|
|
|
|
||
|
Revenue Mix |
|
Comparable Sales |
||||||||
|
Three Months Ended |
|
Three Months Ended |
||||||||
Domestic Segment |
February 1, 2025 |
|
February 3, 2024 |
|
February 1, 2025 |
|
February 3, 2024 |
||||
Computing and Mobile Phones |
44 |
% |
|
42 |
% |
|
6.5 |
% |
|
(4.2 |
)% |
Consumer Electronics |
31 |
% |
|
31 |
% |
|
(2.2 |
)% |
|
(9.0 |
)% |
Appliances |
10 |
% |
|
11 |
% |
|
(11.4 |
)% |
|
(13.7 |
)% |
Entertainment |
9 |
% |
|
10 |
% |
|
(10.9 |
)% |
|
8.4 |
% |
Services |
5 |
% |
|
5 |
% |
|
9.9 |
% |
|
6.3 |
% |
Other |
1 |
% |
|
1 |
% |
|
18.7 |
% |
|
90.8 |
% |
Total |
100 |
% |
|
100 |
% |
|
0.2 |
% |
|
(5.1 |
)% |
|
|
|
|
|
|
|
|
|
|
||
|
Revenue Mix |
|
Comparable Sales |
||||||||
|
Three Months Ended |
|
Three Months Ended |
||||||||
International Segment |
February 1, 2025 |
|
February 3, 2024 |
|
February 1, 2025 |
|
February 3, 2024 |
||||
Computing and Mobile Phones |
46 |
% |
|
44 |
% |
|
8.5 |
% |
|
1.8 |
% |
Consumer Electronics |
29 |
% |
|
31 |
% |
|
(0.7 |
)% |
|
(9.2 |
)% |
Appliances |
9 |
% |
|
9 |
% |
|
4.9 |
% |
|
(4.1 |
)% |
Entertainment |
11 |
% |
|
11 |
% |
|
(3.9 |
)% |
|
16.1 |
% |
Services |
4 |
% |
|
4 |
% |
|
6.2 |
% |
|
7.7 |
% |
Other |
1 |
% |
|
1 |
% |
|
2.4 |
% |
|
(38.8 |
)% |
Total |
100 |
% |
|
100 |
% |
|
3.8 |
% |
|
(1.4 |
)% |
BEST BUY CO., INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES*
($ in millions, except per share amounts)
(Unaudited and subject to reclassification)
The following information provides reconciliations of the most comparable financial measures presented in accordance with accounting principles generally accepted in the
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Three Months Ended |
|
Three Months Ended |
||||||||||||||||||||
|
February 1, 2025 |
|
February 3, 2024 |
||||||||||||||||||||
|
Domestic |
|
International |
|
Consolidated |
|
Domestic |
|
International |
|
Consolidated |
||||||||||||
SG&A |
$ |
2,039 |
|
|
$ |
194 |
|
|
$ |
2,233 |
|
|
$ |
2,069 |
|
|
$ |
202 |
|
|
$ |
2,271 |
|
% of revenue |
|
16.0 |
% |
|
|
15.7 |
% |
|
|
16.0 |
% |
|
|
15.4 |
% |
|
|
16.3 |
% |
|
|
15.5 |
% |
Intangible asset amortization1 |
|
(5 |
) |
|
|
- |
|
|
|
(5 |
) |
|
|
(5 |
) |
|
|
- |
|
|
|
(5 |
) |
Adjusted SG&A |
$ |
2,034 |
|
|
$ |
194 |
|
|
$ |
2,228 |
|
|
$ |
2,064 |
|
|
$ |
202 |
|
|
$ |
2,266 |
|
% of revenue |
|
16.0 |
% |
|
|
15.7 |
% |
|
|
16.0 |
% |
|
|
15.4 |
% |
|
|
16.3 |
% |
|
|
15.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
$ |
147 |
|
|
$ |
70 |
|
|
$ |
217 |
|
|
$ |
512 |
|
|
$ |
49 |
|
|
$ |
561 |
|
% of revenue |
|
1.2 |
% |
|
|
5.7 |
% |
|
|
1.6 |
% |
|
|
3.8 |
% |
|
|
4.0 |
% |
|
|
3.8 |
% |
Intangible asset amortization1 |
|
5 |
|
|
|
- |
|
|
|
5 |
|
|
|
5 |
|
|
|
- |
|
|
|
5 |
|
Restructuring charges2 |
|
(7 |
) |
|
|
- |
|
|
|
(7 |
) |
|
|
161 |
|
|
|
8 |
|
|
|
169 |
|
Goodwill impairment3 |
|
475 |
|
|
|
- |
|
|
|
475 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Adjusted operating income |
$ |
620 |
|
|
$ |
70 |
|
|
$ |
690 |
|
|
$ |
678 |
|
|
$ |
57 |
|
|
$ |
735 |
|
% of revenue |
|
4.9 |
% |
|
|
5.7 |
% |
|
|
4.9 |
% |
|
|
5.1 |
% |
|
|
4.6 |
% |
|
|
5.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effective tax rate |
|
|
|
|
|
|
|
|
47.2 |
% |
|
|
|
|
|
|
|
|
|
21.2 |
% |
||
Intangible asset amortization1 |
|
|
|
|
|
|
|
|
(0.8 |
)% |
|
|
|
|
|
|
|
|
|
- |
% |
||
Restructuring charges2 |
|
|
|
|
|
|
|
|
1.1 |
% |
|
|
|
|
|
|
|
|
|
0.9 |
% |
||
Goodwill impairment3 |
|
|
|
|
|
|
|
|
(26.4 |
)% |
|
|
|
|
|
|
|
|
|
- |
% |
||
Loss on investments |
|
|
|
|
|
|
|
|
(0.1 |
)% |
|
|
|
|
|
|
|
|
|
- |
% |
||
Adjusted effective tax rate |
|
|
|
|
|
|
|
|
21.0 |
% |
|
|
|
|
|
|
|
|
|
22.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Three Months Ended |
|
Three Months Ended |
||||||||||||||||||||
|
February 1, 2025 |
|
February 3, 2024 |
||||||||||||||||||||
Pretax
|
|
Net of Tax5 |
|
Per Share |
|
Pretax
|
|
Net of Tax5 |
|
Per Share |
|||||||||||||
Diluted EPS |
|
|
|
|
|
|
$ |
0.54 |
|
|
|
|
|
|
|
|
|
|
$ |
2.12 |
|
||
Intangible asset amortization1 |
$ |
5 |
|
|
$ |
4 |
|
|
|
0.02 |
|
|
$ |
5 |
|
|
$ |
3 |
|
|
|
0.02 |
|
Restructuring charges2 |
|
(7 |
) |
|
|
(5 |
) |
|
|
(0.02 |
) |
|
|
169 |
|
|
|
127 |
|
|
|
0.58 |
|
Goodwill impairment3 |
|
475 |
|
|
|
433 |
|
|
|
2.02 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Loss on investments |
|
7 |
|
|
|
6 |
|
|
|
0.02 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Adjusted diluted EPS |
|
|
|
|
|
|
$ |
2.58 |
|
|
|
|
|
|
|
|
|
|
$ |
2.72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Twelve Months Ended |
|
Twelve Months Ended |
||||||||||||||||||||
|
February 1, 2025 |
|
February 3, 2024 |
||||||||||||||||||||
|
Domestic |
|
International |
|
Consolidated |
|
Domestic |
|
International |
|
Consolidated |
||||||||||||
SG&A |
$ |
7,021 |
|
|
$ |
630 |
|
|
$ |
7,651 |
|
|
$ |
7,236 |
|
|
$ |
640 |
|
|
$ |
7,876 |
|
% of revenue |
|
18.4 |
% |
|
|
19.1 |
% |
|
|
18.4 |
% |
|
|
18.0 |
% |
|
|
19.1 |
% |
|
|
18.1 |
% |
Intangible asset amortization1 |
|
(21 |
) |
|
|
- |
|
|
|
(21 |
) |
|
|
(61 |
) |
|
|
- |
|
|
|
(61 |
) |
Adjusted SG&A |
$ |
7,000 |
|
|
$ |
630 |
|
|
$ |
7,630 |
|
|
$ |
7,175 |
|
|
$ |
640 |
|
|
$ |
7,815 |
|
% of revenue |
|
18.3 |
% |
|
|
19.1 |
% |
|
|
18.4 |
% |
|
|
17.9 |
% |
|
|
19.1 |
% |
|
|
18.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
$ |
1,154 |
|
|
$ |
108 |
|
|
$ |
1,262 |
|
|
$ |
1,467 |
|
|
$ |
107 |
|
|
$ |
1,574 |
|
% of revenue |
|
3.0 |
% |
|
|
3.3 |
% |
|
|
3.0 |
% |
|
|
3.7 |
% |
|
|
3.2 |
% |
|
|
3.6 |
% |
Intangible asset amortization1 |
|
21 |
|
|
|
- |
|
|
|
21 |
|
|
|
61 |
|
|
|
- |
|
|
|
61 |
|
Restructuring charges2 |
|
(3 |
) |
|
|
- |
|
|
|
(3 |
) |
|
|
147 |
|
|
|
6 |
|
|
|
153 |
|
Goodwill impairment3 |
|
475 |
|
|
|
- |
|
|
|
475 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Adjusted operating income |
$ |
1,647 |
|
|
$ |
108 |
|
|
$ |
1,755 |
|
|
$ |
1,675 |
|
|
$ |
113 |
|
|
$ |
1,788 |
|
% of revenue |
|
4.3 |
% |
|
|
3.3 |
% |
|
|
4.2 |
% |
|
|
4.2 |
% |
|
|
3.4 |
% |
|
|
4.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effective tax rate |
|
|
|
|
|
|
|
|
28.7 |
% |
|
|
|
|
|
|
|
|
|
23.5 |
% |
||
Intangible asset amortization1 |
|
|
|
|
|
|
|
|
(0.6 |
)% |
|
|
|
|
|
|
|
|
|
0.1 |
% |
||
Restructuring charges2 |
|
|
|
|
|
|
|
|
0.1 |
% |
|
|
|
|
|
|
|
|
|
0.2 |
% |
||
Goodwill impairment3 |
|
|
|
|
|
|
|
|
(4.9 |
)% |
|
|
|
|
|
|
|
|
|
- |
% |
||
Adjusted effective tax rate |
|
|
|
|
|
|
|
|
23.3 |
% |
|
|
|
|
|
|
|
|
|
23.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Twelve Months Ended |
|
Twelve Months Ended |
||||||||||||||||||||
|
February 1, 2025 |
|
February 3, 2024 |
||||||||||||||||||||
Pretax Earnings |
|
Net of Tax5 |
|
Per Share |
|
Pretax Earnings |
|
Net of Tax5 |
|
Per Share |
|||||||||||||
Diluted EPS |
|
|
|
|
|
|
$ |
4.28 |
|
|
|
|
|
|
|
|
$ |
5.68 |
|
||||
Intangible asset amortization1 |
$ |
21 |
|
|
$ |
16 |
|
|
|
0.08 |
|
|
$ |
61 |
|
|
$ |
46 |
|
|
|
0.21 |
|
Restructuring charges2 |
|
(3 |
) |
|
|
(2 |
) |
|
|
(0.01 |
) |
|
|
153 |
|
|
|
115 |
|
|
|
0.53 |
|
Goodwill impairment3 |
|
475 |
|
|
|
433 |
|
|
|
1.99 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Loss on investments |
|
7 |
|
|
|
6 |
|
|
|
0.03 |
|
|
|
11 |
|
|
|
11 |
|
|
|
0.05 |
|
Gain on sale of subsidiary, net4 |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(21 |
) |
|
|
(21 |
) |
|
|
(0.10 |
) |
Adjusted diluted EPS |
|
|
|
|
|
|
$ |
6.37 |
|
|
|
|
|
|
|
|
$ |
6.37 |
|
(1) |
Represents the non-cash amortization of definite-lived intangible assets associated with acquisitions, including customer relationships, tradenames and developed technology assets. |
(2) |
Represents charges related to employee termination benefits and subsequent adjustments to previously planned organizational changes and higher-than-expected employee retention associated with enterprise-wide restructuring initiatives. |
(3) |
Represents a non-cash goodwill impairment charge related to our Best Buy Health reporting unit. |
(4) |
Represents the gain on sale of a |
(5) |
The non-GAAP adjustments primarily relate to the |
|
|
* Beginning in Q4 FY25, the company renamed all of its non-GAAP financial measures to adjusted financial measures; for example, non-GAAP SG&A has been renamed to adjusted SG&A. The methodology for calculating these measures remains unchanged, and therefore any previously reported non-GAAP financial measures that are renamed to corresponding adjusted financial measures remain unchanged. |
Return on Assets and Adjusted Return on Investment*
The tables below provide calculations of return on assets ("ROA") (GAAP financial measure) and adjusted return on investment (“ROI”) (non-GAAP financial measure) for the periods presented. The company believes ROA is the most directly comparable financial measure to ROI. Adjusted ROI is defined as ROI operating income divided by average invested operating assets. All periods presented below apply this methodology consistently. The company believes adjusted ROI is a meaningful metric for investors to evaluate capital efficiency because it measures how key assets are deployed by adjusting operating income and total assets for the items noted below. This method of determining adjusted ROI may differ from other companies' methods and therefore may not be comparable to those used by other companies.
|
|
|
|
|
|
||
Return on Assets ("ROA") |
February 1, 20251 |
|
February 3, 20241 |
||||
Net earnings |
$ |
927 |
|
|
$ |
1,241 |
|
Total assets |
|
16,055 |
|
|
|
15,888 |
|
ROA |
|
5.8 |
% |
|
|
7.8 |
% |
|
|
|
|
|
|
||
Adjusted Return on Investment ("ROI") |
February 1, 20251 |
|
February 3, 20241 |
||||
Numerator |
|
|
|
|
|
||
Operating income |
$ |
1,262 |
|
|
$ |
1,574 |
|
Add: Non-GAAP operating income adjustments2 |
|
493 |
|
|
|
214 |
|
Add: Operating lease interest3 |
|
115 |
|
|
|
113 |
|
Less: Income taxes4 |
|
(458 |
) |
|
|
(466 |
) |
Add: Depreciation |
|
845 |
|
|
|
862 |
|
Add: Operating lease amortization5 |
|
667 |
|
|
|
661 |
|
ROI operating income |
$ |
2,924 |
|
|
$ |
2,958 |
|
|
|
|
|
|
|
||
Denominator |
|
|
|
|
|
||
Total assets |
$ |
16,055 |
|
|
$ |
15,888 |
|
Less: Excess cash6 |
|
(400 |
) |
|
|
(258 |
) |
Add: Accumulated depreciation and amortization7 |
|
5,270 |
|
|
|
5,122 |
|
Less: Adjusted current liabilities8 |
|
(8,400 |
) |
|
|
(8,389 |
) |
Average invested operating assets |
$ |
12,525 |
|
|
$ |
12,363 |
|
|
|
|
|
|
|
||
Adjusted ROI |
|
23.3 |
% |
|
|
23.9 |
% |
(1) |
Income statement accounts represent the activity for the trailing 12 months ended as of each of the balance sheet dates. Balance sheet accounts represent the average account balances for the trailing 12 months ended as of each of the balance sheet dates. |
(2) |
Non-GAAP operating income adjustments include continuing operations adjustments for goodwill impairments, restructuring charges and amortization of definite-lived intangible assets associated with acquisitions. Additional details regarding these adjustments are included in the Reconciliation of Non-GAAP Financial Measures schedule within the company’s earnings releases. |
(3) |
Operating lease interest represents the add-back to operating income to approximate the total interest expense that the company would incur if its operating leases were owned and financed by debt. The add-back is approximated by multiplying average operating lease assets by |
(4) |
Income taxes are approximated by using a blended statutory rate at the Enterprise level based on statutory rates from the countries in which the company does business, which primarily consists of the |
(5) |
Operating lease amortization represents operating lease cost less operating lease interest. Operating lease cost includes short-term leases, which are immaterial, and excludes variable lease costs as these costs are not included in the operating lease asset balance. |
(6) |
Excess cash represents the amount of cash, cash equivalents and short-term investments greater than |
(7) |
Accumulated depreciation and amortization represents accumulated depreciation related to property and equipment and accumulated amortization related to definite-lived intangible assets. |
(8) |
Adjusted current liabilities represent total current liabilities less short-term debt and the current portions of operating lease liabilities and long-term debt. |
|
|
* Beginning in Q4 FY25, the company renamed all of its non-GAAP financial measures to adjusted financial measures; for example, non-GAAP SG&A has been renamed to adjusted SG&A. The methodology for calculating these measures remains unchanged, and therefore any previously reported non-GAAP financial measures that are renamed to corresponding adjusted financial measures remain unchanged. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250303240791/en/
Investor Contact:
Mollie O'Brien
mollie.obrien@bestbuy.com
Media Contact:
Carly Charlson
carly.charlson@bestbuy.com
Source: Best Buy Co., Inc.