Best Buy fails to impress with crucial December sales
Shares fall nearly 5%
US retail giant Best Buy saw sales drop in December, with some wallet-shy customers steering clear of the firm’s stores.
The Richfield, Minnesota-based company tried to woo more punters through the door by offering them special holiday discounts. However, it didn’t pay off for Best Buy, which reported a sales dip of 6.5 per cent in stores open at least 14 months.
It brought in total revenues of $7.5bn in the final month of last year when the firm announced that it would open fewer chains in 2009 in the US, Canada and China in an effort to cut capital spending by half for this year.
Best Buy also offered so-called “enhanced” redundancy packages to about 4,000 staff after the retailer saw its third quarter profit plummet 77 per cent.
According to the Minneapolis Star Tribune, 500 workers at the firm’s headquarters have already taken voluntary redundancy.
Just yesterday, US retail rival Wal-Mart was forced to slash its Q4 profit forecast after admitting that fewer customers had bought goods in the run-up to Christmas than it had hoped for.
Best Buy shares are currently trading at $28.30, down 4.55 per cent on Wall Street. ®