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Best Buy forecasts annual revenue below estimates as supply crunch bites

Randy Mancini 18 Mar 3
The Best Buy logo is seen at a store in Manhattan, New York City
FILE PHOTO: The Best Buy logo is seen at a store in Manhattan, New York City, U.S., November 22, 2021. REUTERS/Andrew Kelly

March 3, 2022

(Reuters) – Best Buy Co Inc forecast downbeat full-year revenue and fell short of holiday quarter sales estimates on Thursday, with the top U.S. electronics retailer shackled by product shortages and an Omicron-caused staffing crunch.

Shortages in appliances, mobile phones and gaming consoles due to a global lack of semiconductor chips and supply-chain bottlenecks have crimped Best Buy’s sales in the closing months of last year. A surge in transportation costs has also taken a toll on the company’s profit margins.

“Q4 sales of $16.4 billion were impacted by more constrained inventory than expected, including some high-demand holiday items, and the temporary reduction in store hours in January due to Omicron-induced staffing challenges,” Chief Executive Officer Corie Barry said in a statement.

A big beneficiary from pandemic-era home-working, the company said it expects full-year revenue of $49.3 billion to $50.8 billion, while analysts on average had estimated $51.05 billion, according to IBES data from Refinitiv.

Comparable sales fell 2.3% in the fourth quarter ended Jan. 29, compared with analysts’ estimates of a 0.2% dip.

(Reporting by Uday Sampath in Bengaluru; Editing by Sriraj Kalluvila)