BEST BUY POSTS MIXED 10 RESULTS BUT GADGET SLUMP WILL BOTTOM OUT AS SHOPPERS REPLACE THEIR DEVICES

Best Buy turned in a first-quarter profit that beat Wall Street expectations, while the nation’s largest consumer electronics chain continued to wrestle with weak consumer demand for gadgets.

But the Minneapolis-based chain predicted on Thursday that the slump in consumer electronics will bottom out by year-end as customers who bought gadgets at the onset of the pandemic will start to update their devices.

For now, Best Buy reaffirmed its cautious financial outlook, underscoring continued economic uncertainty. 

Best Buy’s sales during the depths of the pandemic were fueled by oversized spending by Americans who splurged on gadgets to help them work from home or help their children with virtual learning. Government stimulus checks drove a lot of that spending. But more than a year ago, consumers began to pull back from items that were popular during the pandemic like TVs and casual clothing as they became more social. Then stubbornly high inflation has also made shoppers more selective about buying gadgets and other items.

“In this environment, customers are clearly feeling cautious and making tradeoff decisions as they continue to deal with high inflation,” said Best Buy CEO Corie Barry.