By Dhirendra Tripathi
Investing.com – Best Buy Co., Inc. (NYSE:BBY) stock traded 4% higher in premarket Thursday as multiple positive announcements helped overcome the disappointment of earnings and revenue miss in the fourth quarter.
The electronics retailer expects revenue in 2025 to be $55 billion at midpoint of its guidance range, higher than estimates. Revenue in financial year 2022 was about $52 billion.
Hopes of growth returning after December 2023 helped overshadow the gloom over the company’s projection of around $50 billion in revenue this year, $2 billion less. At best, revenue will touch $50.8 billion, according to the company’s range.
“The two largest variables in our FY23 financial outlook on a year-over-year basis are the short-term industry decline as we lap high growth and government stimulus, and the investment in our new membership program, Best Buy Totaltech, which we believe will drive longer-term value,” CEO Corie Barry said in a statement.
A quarterly dividend of 88 cents per share, 26% higher, and a new $5 billion share repurchase program are also boosting the stock. The new buyback replaces the previous exercise, which had $1.6 billion remaining in it.
Revenue for the fourth quarter ended January 29 slipped 3.3% to $16.4 billion as several items were missing from the shelves due to global supply chain issues. This impacted supply of high-demand holiday items as well. Omicron-induced staffing challenges in January meant many stores were open for fewer hours, leading to loss of sales.
On an adjusted basis, profit per share fell over 21% to $2.73, falling behind estimates.