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Christmas In July: Industry Forecasts Mixed Q4

As reflected in the TWICE Top 100, the electronics and appliance channels remain a tale of two cities as retailers begin their fourth-quarter planning.

Best Buy, in its first-quarter earnings review, described an uphill climb for its CE-dominant business, which is expected to grow just enough in the back half of the year to offset slight revenue declines in the first six months, resulting in flat sales and operating income for all of 2016.

As former executive VP and chief financial officer and current executive advisor Sharon McCollam noted, “Based on current industry dynamics and how we see the various product cycles playing out … we recognize this will be challenging without a strong mobile cycle and improvements in the NPD-reported categories overall.”

Related:Purchase the TWICE Retailing Giants Report, ranking the top 100 CE and Major Appliance Retailers.

The latter, which include TVs, computers, tablets (excluding Kindle), digital imaging and other categories, account for about 65 percent of Best Buy’s U.S. sales, and exclude mobile phones, services, gaming, movies and music, and appliances.

Still, as HSN’s electronics & culinary senior VP Sandy Conrad told TWICE (see interview), core legacy businesses like TVs, computers and mobile phones shouldn’t be underestimated come Christmas, while next-gen categories like wearables, smart-home devices, streaming video and whole-home audio, and even drones should continue to grow.

So too, apparently, will appliances. In his own first-quarter earnings report, Whirlpool chairman/CEO Jeff Fettig forecast industry unit shipments in North America to rise by 5-6 percent for the full year, and said his company remains “confident in our ability to delivery our 2016 guidance as we capitalize on robust demand in the U.S. [and] new product introductions.”

Similarly, Electrolux president/CEO Jonas Samuelson described continued “healthy” volume growth in the U.S. market — which hit 8 percent for the company in the first quarter — and projected slightly more reserved industry unit gains of 4-5 percent for the full year.

So what’s the key takeaway from all this? Going out on a limb here, but yes Virginia, there is a Santa Claus.