Best Buy Co (BBY) was among the best-performing stocks in the S&P 500 yesterday, on August 30, rising 1.6% after the company kept its full-year forecast unchanged despite reporting a sales decline in its latest quarterly earnings report. Best Buy reported Q2 FY23 sales decline of 12.8% YoY to $10.33 billion, despite raging inflation, but beating the consensus of $10.24 billion. Domestic revenue dived over 13% YoY, and International revenue fell 9.3%. Enterprise comparable sales decreased 12.1%.

Gross profit fell 18.6% Y/Y to $2.3 billion, with the margin contracting 160 basis points to 22.1%. Operating income as a percentage of revenue contracted 310 basis points to 3.6%. Operating income for the quarter fell 53.5% to $371 million. Non-GAAP EPS of $1.54 beat the analyst consensus of $1.27.

Best Buy held $1.2 billion in cash and equivalents as of July 30, 2022. With $51.8 billion in fiscal 2022 sales, Best Buy is the largest pure-play consumer electronics retailer in the U.S., with roughly 10.6% share of the aggregate market and north of 40% share of offline sales, per our calculations, CTA industry, and Euromonitor data. The electronic stores chain generates the bulk of its sales in-store, with mobile phones and tablets, computers, and appliances representing its three largest categories. Recent investments in e-commerce fulfillment, accelerated by the Covid-19 pandemic, have seen the U.S. e-commerce channel roughly double from prepandemic levels, with management estimating that it will represent a mid-30% proportion of sales moving forward.

BBY's board of directors has authorized the payment of its regular quarterly cash dividend of $0.88 per common share, payable on October 11, 2022, to shareholders of record on September 20, 2022. Best Buy sees Q3 comparable sales decline slightly more than 12.1%. For FY23, the company expects, however, comparable sales to decline by around 11%.