Best Buy (BBY) - Get Report shares were falling Wednesday after the consumer electronics retailer announced it was furloughing 51,000 store employees and that its sales dipped 5% for the nine weeks ended April 4 from a year earlier.
After switching its stores to curbside service only March 22, the company said it retained 70% of its sales.
The furloughs, of course, come as a result of the coronavirus epidemic, which has kept many shoppers at home.
“The situation remains very fluid and there is still a great deal of uncertainty, particularly as it relates to depth and duration of store closures and consumer confidence over time,” Best Buy CEO Corie Barry said in a statement.
“We are taking the steps … keeping in mind our overriding priority on the safety of our employees and customers,” the CEO added.
The furloughed workers include nearly all part-time employees. The company is keeping 82% of its full-time store and field employees on payroll.
In addition, some corporate employees are participating in voluntary reduced work weeks and resulting pay cuts, as well as voluntary furloughs.
Barry will forego 50% of her base salary, and board members will forego 50% of their cash compensation through at least Sept. 1. Executives reporting directly to the CEO will suffer a 20% salary during the same period.
Best Buy also is extending payment terms in partnership with key merchandising vendors and cutting promotional and marketing spending. In addition, it’s lowering capital spending.
Best Buy shares recently traded at $66.48, down 4.82%, and have dropped 27% over the last three months.