Best Buy Co., Inc.

Enterprise revenue was $9.8 billion, up 3.6% year over year. Enterprise comparable sales increased 4.1%, ahead of the roughly 1% guide. Adjusted operating income rate was 4.3%, about 40 basis points higher than last year, and adjusted diluted EPS was $1.47, up 15% year over year. Domestic revenue was $9.1 billion, up 4.3%, with domestic comparable sales up 4.5%; international revenue was $709 million, down 4.2%. Domestic gross profit rate rose 60 basis points to 24%, and international gross profit rate rose 50 basis points to 22.3%. Full-year fiscal 2027 guidance was raised to revenue of $42.3 billion to $42.8 billion, comparable sales growth of 1.9% to 3%, adjusted operating income rate of 4.4% to 4.5%, adjusted EPS of $6.70 to $6.90, an adjusted tax rate of about 25.5%, and capital expenditures of about $750 million. For Q3, management expects comparable sales growth of 1% to 3% and an adjusted operating income rate of about 4.1% to 4.2%.

Corie Barry said the quarter reflected better-than-expected execution and that the business is strengthening its position as an omnichannel tech retailer while also building new profit streams through Best Buy Ads and Marketplace. She emphasized that customer behavior has not materially changed: shoppers are still value-focused, but will spend on innovation and necessary replacements. Her tone was confident and reflective, as she repeatedly pointed to the company being well positioned for continued success and thanked employees and investors as her tenure closes.

Corie Barry, covering financials because the new CFO just joined, said the quarter beat expectations on both comp sales and operating income. She noted the adjusted operating income rate benefited from a higher gross profit rate, including a $34 million tariff-refund benefit, while higher SG&A was mainly driven by incentive compensation. For the full year, she raised gross profit rate expectations to up about 30 to 40 basis points versus last year, expects adjusted SG&A to increase about 20 basis points as a percentage of revenue, and said capital expenditures should be about $750 million. She also said supply chain was a slight gross profit benefit in Q1 and Q2 and should be roughly neutral for the full year, despite higher fuel costs.

Analysts focused on how sustainable the comp momentum is, especially with July flattening after a strong May and with comparisons getting tougher. Management said June was affected by lapping Switch 2 and timing shifts in a major sales event, while August comps were running at the high end of the 1% to 3% back-half range. They also addressed inventory, saying computing inventories were being pulled forward opportunistically because of rising memory costs, but the strategy is not to front-load broadly. On margins and SG&A, management said Ads and Marketplace are a modest tailwind to operating income, but incentive compensation is the larger near-term SG&A driver.