Best Buy’s third-quarter earnings soared past Wall Street’s expectations, but shares dropped Tuesday as the retailer warned of headwinds from higher shipping costs, inventory challenges and lower-margin holiday sales.
The retailer declined to provide an outlook for the fourth quarter — a significant period for electronics and tech purchases during the holidays — due to the uncertainty created by the coronavirus pandemic.
On a conference call, Chief Financial Officer Matt Bilunas said the company will have higher supply chain costs from parcel surcharges and sales of videogame consoles, a popular holiday gift that’s lower margin, will pressure profits.
“We believe our Q4 sales growth will be positive, but we don’t expect sales trends to remain at the levels we experienced during Q3,” he said.
Best Buy shares closed Tuesday down nearly 7% to $113.54. Its stock has gained about 29% so far this year, bringing the company’s market value to