Best Buy Raises Annual EPS Guidance

While net earnings declined, revenue increased by 12% to $11 billion, compared to the previous year's Q2 total of $9.8 billion. According to company executives the gains are due in part to the 170 net new stores that opened worldwide over the past 12 months.

"I am pleased, but not surprised, with the market share gains we posted during the quarter," says CEO Brian Dunn. "Our ability to capture a significant amount of market share in the period is directly correlated to the dedication and expertise of our employees around the world."

Of the new 170 new stores that opened around the globe, 66 stores opened in Europe. More than half of the new locations, 36 stores, were Best Buy's small-format stores. This segment of the company saw Q2 revenue increase 65% over the past 12 months to $2.7 billion.

"Although top-line results continued to be challenged, overall international performance was consistent with our expectations," says Bob Willett, CEO of Best Buy International. "We are pleased with the market share gains in Europe and Canada and the improving performance in China."

Best Buy recently signed a lease in the UK to open a large-format site, which will be the first in the country. The store is slated to open in the Spring 2010.

As a result of this quarter's results, Best Buy executives raised the company's annual EPS guidance. Now the company estimates revenue to total $49 billion, an 8% increase from previous estimates.

"Given these improving trends and our expectations for the remainder of the year, we are both raising the bottom-end of our annual EPS guidance and improving our top-end expectations," says Jim Muehlbauer, Best Buy's EVP of finance and CFO. "Our optimism is balanced by our view that overall consumer spending will remain under pressure given the expected continued softness in the economy and by the fact that most of our earnings are still ahead of us in the holiday selling season."