on Tuesday didn't pull any punches when reporting its fiscal third quarter 2013 earnings, calling its performance "clearly unsatisfactory." The struggling electronics chain reported a GAAP net loss of $13 million for the three-month period ended November 3, 2012, compared to net earnings of $173 million during the same quarter one year ago.
"In line with trends experienced over the last three years, Best Buy’s third quarter financial performance was clearly unsatisfactory. On November 13, we shared our candid assessment of Best Buy’s situation and unveiled Renew Blue, a set of priorities to begin re-invigorating the company’s performance and rejuvenating Best Buy. The results we are reporting today only strengthen our sense of urgency and purpose," said Hubert Joly, Best Buy president and CEO.
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Joly's candid remarks are a breath of fresh air when company execs typically try to sugarcoat poor performance, though words alone won't cure what's ailing Best Buy. Store sales were down during the quarter, contributing to a significant decline in adjusted (non-GAAP) operating income, which has fallen 87 percent year-over-year.
It wasn't an entirely grim quarter though. Best Buy recorded $431 million in its online business, exceeding 10 percent growth, while also registering positive comparable store sales growth in mobile phones, appliances, and tablets/eReaders. However, that growth was "more than offset" by slumping store sales of notebooks, gaming products, digital imaging, and televisions.
"The company believes that tablet and notebook comparable store sales were negatively impacted by slower consumer purchasing in anticipation of major product launches," Best Buy said.
Looking ahead in the short-term, Best Buy will inevitably benefit from the holiday shopping season, starting with Black Friday and continuing through Cyber Monday. It was reported that shoppers had already started camping out
in front of some Best Buy locations a week ahead of Black Friday.
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Best Buy earlier this year announced plans
to shut down 50 U.S. big box brick-and-mortar retail locations, which was part of a restructuring effort to cut costs by $800 million