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Best Buy boss "neither pleased nor satisifed" by Q1 numbers

Microscope contributor

The combination of higher than expected operational costs and inconsistent consumer demand meant Best Buy's fiscal Q1 profits fell short of expectations.

The largest retailer in the US pushed up sales 7% to $10.8bn as the bottom line increased marginally from $153m to $155m.

Best Buy CEO Brian Dunn said "I am neither pleased nor satisfied with our first quarter results" and added that although there were positive indicators in the numbers profits were "below our expectations".

"Consumer spending has been episodic and it appears that our customers are operating on cues from the broader environment," said Dunn.

The bottom line was also hit by S,G&A costs which the firm had expected to be up in the quarter but was "higher than we had targeted", up from $2.2bn a year ago to $2.48bn.

Domestic sales in its US heartland went up 5% to $7.9bn with low double digit like-for-like store sales rises in notebooks, mobile phones and appliances.

Dunn said it had seen "significant traction in our strategic investments outside of the US". International revenues grew 11% to $2.9bn due in part to favourable currency translations.

The retailer opened its first stores in the UK in the last few weeks but management said they will only invest in further expansion across all regions once the initial set up shows clearer signs of bedding down.

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