Best Buy Co. Inc., the nation's largest consumer electronics retailer, delivered robust earnings on strong sales Tuesday — further evidence that shoppers are doling out more money for GPS navigators and game consoles than for apparel and shoes.
For the three months ended Dec. 1, earnings leapt 34.2 percent to $228 million, or 53 cents a diluted share, from $150 million, or 31 cents, in the year-ago period. This growth is attributed to new store openings, an increase in the average selling price of key goods, as well as an extra week of post-Thanksgiving revenue. Sales for the quarter grew 14.7 percent to $9.9 billion from $8.4 billion in the same period last year. Domestic and international revenue jumped 15 and 32 percent, respectively, as a favorable foreign exchange rate, coupled with the opening of new stores, bolstered sales.
The retailer's results quantify recent government spending data that shows a shift in consumer spending away from apparel and shoes. According to the Bureau of Economic Analysis, real personal consumption expenditures on apparel and shoes grew 0.3 percent from the second quarter of this year to the third quarter. This compares with 2.4 percent for furniture and household equipment, which includes consumer electronics. Year-over-year, expenditures in home goods climbed 8 percent versus apparel and shoes' 2.1 percent gain.
Top sellers for Best Buy as it was heading into the critical holiday shopping season included flat-panel TVs, game consoles (and related software) and GPS navigation devices.
But similar to its apparel retail counterparts, Best Buy's strong sales growth is coming at the expense of gross margins. Goldman Sachs retail analyst Matthew J. Fassler said in a research note that the "quality of [Best Buy's] earnings was solid. That said, we would point out that gross margin, while it beat published consensus, met, rather than beat, our forecast."
Best Buy raised its full-year earnings guidance to a range of $3.10 to $3.20 a diluted share from $3 to $3.15.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast