Best Buy Beats Q2 Estimates and Raises Full-Year Outlook but Stock Falls 5%

Best Buy reported fiscal second-quarter adjusted earnings per share of $1.47, topping the $1.38 consensus estimate and up 15% year over year, while revenue of $9.78 billion beat the $9.59 billion forecast and grew 3.6% from a year ago. Comparable sales rose 4.1%, with particular strength in computing, mobile phones, home theater and newer categories including AI glasses and collectibles. The adjusted operating margin expanded 160 basis points to 4.3%, ahead of the 3.9% posted a year earlier.

Domestic revenue reached $9.1 billion, up 4%, while international revenue slipped 4% to $709 million. Domestic online revenue grew 5.1% on a comparable basis to $3.0 billion. On the strength of the first half, Best Buy raised its full fiscal 2027 guidance: adjusted EPS is now expected in a range of $6.70 to $6.90, up from a prior range of $6.30 to $6.60, and revenue guidance was lifted to $42.3 billion to $42.8 billion from $41.28 billion to $42.18 billion.

Full-year comparable sales guidance moved to a range of positive 1.9% to 3.0%, compared with a previous range of negative 1.0% to positive 1.0%. For the third quarter, the company guided comparable sales growth of 1% to 3% and an adjusted operating income rate of 4.1% to 4.2%. The company also declared a quarterly dividend of $0.96 per share and guided for approximately $300 million in full-year share repurchases.

Best Buy said advertising revenue is on track to approach $1 billion this fiscal year, and the company is targeting $1.3 billion in marketplace gross merchandise volume. Despite the broad beat and raised outlook, shares fell roughly 5% to 6% in premarket trading, with investors citing margin concerns. CEO Corie Barry, who credited gains across categories and growing ad revenue, is set to step down this fall, with incoming CEO Jason Bonfig highlighting store momentum during the earnings call.