Strong Revenue Growth and Strategic …

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• Revenue: $9.7 billion, a 2.4% increase year-over-year.

• Adjusted Operating Income Rate: 4%, 30 basis points better than expected.

• Adjusted Earnings Per Share: Increased 11% year-over-year to $1.40.

• Comparable Sales Growth: 2.7%, exceeding expectations.

• Domestic Revenue: $8.9 billion, a 2.1% increase driven by 2.4% comparable sales growth.

• Online Revenue: $2.8 billion, a 3.5% increase on a comparable basis, representing 31.8% of domestic revenue.

• International Revenue: $794 million, a 6.1% increase driven by 6.3% comparable sales growth.

• Domestic Gross Profit Rate: Decreased by 30 basis points to 23.3%.

• International Gross Profit Rate: Increased by 30 basis points to 22.8%.

• SG&A Expenses: Domestic adjusted SG&A decreased by $4 million.

• Shareholder Returns: $802 million returned through dividends and share repurchases year-to-date.

• Fourth Quarter Comparable Sales Guidance: Expected range of down 1% to up 1%.

• Full Year Revenue Guidance: $41.65 billion to $41.95 billion.

• Full Year Comparable Sales Growth Guidance: 0.5% to 1.2%.

• Full Year Adjusted Operating Income Rate Guidance: Approximately 4.2%.

• Full Year Adjusted Diluted EPS Guidance: $6.25 to $6.35.

Release Date: November 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Best Buy Co Inc (NYSE:BBY) reported strong third-quarter results with revenue of $9.7 billion, an adjusted operating income rate of 4%, and an 11% year-over-year increase in adjusted earnings per share to $1.40.

• The company achieved better-than-expected comparable sales growth of 2.7%, driven by strong sales in computing, gaming, and mobile phones.

• Online sales increased for the fourth consecutive quarter, supported by higher traffic and increased customer adoption of the Best Buy app.

• The launch of the Best Buy marketplace has been successful, with over 1,000 sellers and 11 times more SKUs available online, contributing positively to gross profit rates.

• Best Buy Co Inc (NYSE:BBY) continues to innovate with new in-store experiences and partnerships, such as immersive showcase areas for AI glasses and collaborations with IKEA, enhancing customer engagement and satisfaction.

• The company experienced declines in the home theater, appliance, and drone categories, which partially offset growth in other areas.

• Best Buy Co Inc (NYSE:BBY) anticipates a decline in fourth-quarter gross profit rate due to increased promotional investments and lower product margin rates.

• The appliance market remains challenging, with a high percentage of single-unit purchases and a focus on duress customers, impacting promotional effectiveness.

• Despite positive momentum, the fourth-quarter comparable sales outlook is expected to be in the range of down 1% to up 1%, reflecting potential challenges in maintaining growth.

• The company recorded pretax noncash asset impairments of $192 million related to Best Buy Health, indicating pressures in the Medicaid and Medicare Advantage markets.

Q: Can you discuss the puts and takes on Q4 guidance, especially in terms of sales and profit expectations? A: Matthew Bilunas, CFO, explained that the high end of Q4 sales guidance is similar to previous expectations, with a slight adjustment on the low end. The EBIT expectations were slightly lowered due to rate pressure and adjusted revenue expectations, but overall, the guidance remains consistent with prior discussions.

Q: How is the adoption of products like the Nintendo Switch 2 and iPhone affecting future momentum? A: Matthew Bilunas noted that computing and mobile phones are expected to continue growing due to replacement needs and innovation. The Nintendo Switch 2 will support growth in Q4, but other consoles may slow due to their lifecycle stages. Improvements in TV trends and marketplace initiatives are also expected to contribute positively.

Q: What is driving the deceleration in Q4 outlook despite momentum from Q3? A: Matthew Bilunas highlighted that Q3 benefited from strong back-to-school and October sales, but Q4 faces tougher comparisons. Categories like gaming and wearables may not grow at the same pace as in Q3, and the holiday season’s unpredictability requires a range of scenarios for planning.

Q: How is the new marketplace performing, and what challenges have you encountered? A: Corie Barry, CEO, expressed satisfaction with the marketplace launch, noting over 1,000 sellers and 11x more SKUs. Early indicators are positive, with high unit sales in accessories and small appliances, lower return rates, and strong customer experience metrics. However, the ramp is still early, and the focus is on scaling through Q4.

Q: Can you provide more details on the loyalty program’s performance and future plans? A: Corie Barry stated that the membership program is crucial, with nearly 8 million paid members. The focus is on driving value through personalized promotions and unique offers, such as discounts on NFL Sunday tickets. The goal is to increase engagement, share of wallet, and support the ads business.

Q: How are you planning store investments for the coming year? A: Corie Barry emphasized the importance of stores as crucial assets for experiences and fulfillment. Investments focus on store look and feel, vendor partnerships, and exploring smaller format stores. The goal is to ensure stores reflect immersive experiences and meet customer expectations.

Q: How are tariffs affecting pricing and average unit retail (AUR)? A: Matthew Bilunas explained that tariffs are included in pricing, but the promotional nature of the industry and product mix changes can mute their impact on AUR. The focus remains on offering products at every price point to meet customer budgets.

Q: How does vendor-supported labor in stores impact customer engagement? A: Corie Barry described the flexible labor model, which includes vendor-supported labor, as enhancing customer engagement. The model allows for specialized expertise while maintaining Best Buy’s service culture, improving customer interactions and satisfaction.

Q: What are the prospects for Agentic Commerce and instant checkout? A: Corie Barry indicated a fast timeline for integration, focusing on customer experience and ensuring seamless transactions, especially for scheduled deliveries and services. The goal is to enhance brand presence and customer engagement through Agentic tools.

Q: How are you managing SG&A expenses amid sales growth? A: Matthew Bilunas noted that SG&A favorability in Q3 was due to higher sales leverage, lower technology and labor spend, and smaller settlements. The focus remains on operational efficiencies and cost reductions to offset pressures and drive profitability.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.