Best Buy Co. Inc. (BBY) - Get Report shares surged higher Wednesday after the electronics retailer posted a stronger-than-expected second quarter sales update thanks to a surge in online demand for computers and tablets.
Best Buy said sales for the company's fiscal second quarter, which started on May 3, have risen 2.5% through to July 18, compared to last year's pace, while accounting for sales in stores that began fully re-opening on June 15, Best Buy said, the increase is 15% from last year.
Online sales, meanwhile nearly tripled, rising 255% from May 3 to July 18 thanks to growth in demand for computers, appliances and computer tablets. Online sales from June 15 through to July 18 rose 185%, Best Buy said, compared to a 155% pace recorded over the whole of its fiscal first quarter.
Best Buy also said it would raise the starting hourly wage for all U.S. employees to $15 per hour, starting on August 2.
"Strong consumer demand, combined with shopping experiences that emphasize safety and convenience, has helped produce our sales results to date," said CEO Corie Barry. "None of this would be possible without the effort and energy of our front-line employees working in stores, supply chain facilities and customers' homes".
Best Buy shares were marked 6.2% higher in early trading following the sale update to change hands at $95.88 each, a move that would bump the stock's year-to-date gain to around 9%.
Best Buy reported non-GAAP earnings for the three months ending on May 2 of 67 cents per share, down 34.3% from the same period last year but firmly ahead of the Street consensus forecast of 43 cents per share.
Group revenues, Best Buy said, fell 6.8%, but at $8.56 billion were again ahead of analysts' forecasts as a surge in online electronics sales offset reduce foot traffic and partial store closures during the peak of the coronavirus pandemic.
The group also confirmed a cash dividend of 55 cents per share but scrapped its full-year earnings forecast.