Best Buy Co Inc (NYSE:BBY) shares jumped 17% after the retailer’s first quarter earnings topped Wall Street expectations and the company reaffirmed its full-year outlook.
The company reported adjusted earnings per share of $1.28, topping analyst estimates of $1.22, while total revenue rose to $8.94 billion, above expectations of $8.82 billion.
Comparable sales increased 2% during the quarter, reversing a year-ago decline, with domestic comparable sales up 1.8% and international comparable sales rising 4.7%.
Enterprise revenue reached $8.94 billion, compared with $8.77 billion in the prior-year period.
Operating income improved, with operating income as a percentage of revenue rising to 4.1% from 2.5% a year earlier.
Adjusted operating income margin was 4.1%, compared with 3.8% in the prior year.
The company reiterated its full-year 2027 guidance, including revenue of $41.2 billion to $42.1 billion, comparable sales ranging from a decline of 1% to growth of 1%, and adjusted diluted EPS of $6.30 to $6.60.
Corie Barry, Best Buy CEO, welcomed the better-than-expected results for Q1.
“Our comparable sales grew 2% versus last year, higher than our outlook, with positive comps across the majority of our major product categories and strong performance in our Best Buy Ads and Marketplace initiatives,” Barry said. “We also drove operating income rate expansion and EPS growth.”
Matt Bilunas, Best Buy CFO, added that comparable sales had a strong start in May, with month-to-month growth up by high single digits.
“Our comparable sales outlook for the full quarter is approximately 1% growth as we start to lap last year’s very successful gaming launch in June,” Bilunas said. “We expect our Q2 adjusted operating income rate to be approximately 3.9%, which is flat to last year.”