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Best Buy Dec. Sales Grow 13%

1/08/2010 10:20:02 AM Eastern
LAS VEGAS - Strong sales of notebook computers, mobile phones and major appliances, and a surge in online orders, boosted Best Buy's net domestic revenue 13 percent to $6.7 billion in December, while comp-store sales soared 9.3 percent.

 Best Buy CEO Brian Dunn, left, and executive VP Mike Vitelli at the Digital Entertainment Group (DEG) fete Thursday night, where the company received the Retailer of the Year award.
Although the figures lap a dismal December 2008, when the nation was still reeling from turmoil in the financial markets, they outpace the broad retail marketplace and exceed the 0.8 percent decline in CE holiday sales tracked by The NPD Group.

Comp sales for the company's home office category, which includes notebooks and mobile phones, rose 28.5 percent thanks to a broad assortment and differentiated customer experience, Best Buy said.

Major appliances, a category that has experienced industrywide weakness for the past three years, enjoyed a 16.2 percent increase in December comps, as momentum from aggressive Black Friday promotions continued into the month.

The company's core consumer electronics category posted a 4.5 percent comp-store increase, which Best Buy attributed to an "industry-leading assortment of televisions."

Comp sales were flat for the services category, and comp sales of entertainment software slipped 0.6 percent as continued declines in music and movies more than offset an increase in gaming.

Also driving December sales was a 34 percent increase in online revenue, driven primarily by growth in Web site traffic, Best Buy said.

"It's very gratifying that our focus on the customer is producing such great results," said CEO Brian Dunn. "The holiday selling season is critically important to a retailer. Our preparations for December begin in January, and this year the stakes were higher than ever, given the tough environment we're all navigating. I couldn't be more proud of the extraordinary effort our people put forth â€” at our support, distribution and service centers, and, of course, in our stores."

Best Buy believes it continued to gain market share in December, and said its share gains accelerated during the fiscal quarter ending Nov. 30, 2009. The company said it enjoyed the largest increases in categories that are critical to its "connected world strategy," such as TVs, notebook computers, digital imaging and mobile phones.

Total company revenue increased 13 percent to $8.5 billion for the five-week period, ended Jan. 2, and company-wide comps increased 8.2 percent, aided by new overseas stores and favorable foreign currency exchange rates.

 The company's international segment increased its December revenue by 13 percent to $1.8 billion and comp-store sales grew 3.5 percent, led by growth in China and Europe. Excluding the impact of foreign currency fluctuations, revenue increased 4 percent and comps grew by the low single-digits.

Chief financial officer Jim Muehlbauer said the company is on track to hit its fourth-quarter earnings projections based on the December results. "Our employees have done an outstanding job of meeting the needs of customers and delivering strong performance in this challenging consumer spending environment," he said.

The company expects to report its Q4 results on March 25.
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