NEW YORK (TheStreet) - Best Buy (BBY) shares were surging 8% to $27.88 in pre-market trading after the electronics retailer reported better-than-expected fourth-quarter profit fueled by its cost reduction initiative, announced in 2012.
On a GAAP basis, net earnings attributable to Best Buy came in at $293 million, or 83 cents a share, compared to a loss of $409 million, or $1.21 a share, in the year earlier quarter. GAAP earnings from continuing operations were 88 cents a share, compared to a loss of $1.36 a share last year, the company said Thursday morning.
On a non-GAAP basis, operating income from continuing operations came in at $1.24 a share versus $1.47 a share in the year-earlier quarter. Analysts were calling for earnings of $1.01 a share, according to Thomson Reuters.
Best Buy had laid out a plan at its 2012 Investor Day to realize roughly $725 million in cost savings across its roughly 1,000 stores in North America. The company said Thursday that total cost savings to date were roughly $765 million and boosted its overall cost cutting target to $1 billion.
It expects the additional cost savings to come from the "optimization" of returns, replacements and damages as well as logistics and supply chain.
Best Buy's revenue of $14.47 billion fell 3% compared to the year earlier. Quarterly revenue was softer than analysts' expectations of $14.66 billion.