stock was up almost 5% in premarket trading Wednesday, bumping against all-time highs on Tuesday morning after the electronics retailer provided a rosy fiscal second-quarter update that showed a triple-digit jump in online sales.
Best Buy said its quarter-to-date sales through July 18 climbed 2.5% year over year, with domestic sales up 2% and international sales rising 8%. However, with store closures and consumer fears about the spread of coronavirus, e-commerce was the star of the show. Best Buy notched a 255% increase in digital sales, with computers, appliances, and tablets among the strongest product categories.
The company said it began opening locations for in-store shopping without appointments around June 15, and since that date through July 18 companywide sales growth was about 15%, while online sales continued to see robust growth, rising 185%.
Additionally, Best Buy said it would raise the hourly wage for all U.S. employees to $15 an hour on Aug. 2. About half of its 51,000 hourly employees are back to work after furloughs.
Best Buy shares were up 4.8% to $94.64 as
futures slipped 0.1%.
It isn’t hard to see why investors were enthusiastic about the update: Even with stores reopening and some employees going back to the office, Best Buy saw digital sales continue to soar, a hopeful sign that it will continue to benefit from consumers’ focus on remote working and at-home entertainment even as some public spaces reopen. Much like the trends in the home-improvement space, Best Buy’s sales seem to show that many shoppers are preparing to spend more time at home amid increasing Covid-19 cases and a patchwork of lockdown measures.
The company’s decision to raise wages echoes
(TGT) move to the $15 level. The move should help reduce costly turnover and get ahead of any potentially federally mandated minimum-wage increases.
For bulls who argue that Best Buy is best-positioned to come out of the pandemic as a winner in retail, this update will add fuel to their hopes.
Write to Teresa Rivas at firstname.lastname@example.org