In its recently released 10-Q report, Best Buy Co., Inc. revealed a decline in revenue and comparable sales for the first quarter of fiscal 2025. The company operates in the retail of technology products in the United States, Canada, and internationally, offering a wide range of products and services through its various brands and channels. Best Buy's two reportable segments are Domestic and International, with a fiscal year ending on the Saturday nearest the end of January.
In the first quarter of fiscal 2025, Best Buy's revenue stood at $8.8 billion, reflecting a 6.5% decrease from the same period in the prior year. Comparable sales also declined by 6.1% during this period. The company's gross profit was $2.1 billion, with a gross profit rate of 23.3% of revenue. Operating income remained relatively stable at $312 million, representing 3.5% of revenue. Net earnings for the quarter were $246 million, leading to diluted earnings per share of $1.13.
The company's Domestic segment experienced a 6.8% decrease in revenue, primarily driving the changes in revenue, gross profit rate, SG&A, and operating income rate. Best Buy's store count also saw a slight reduction, with approximately 10 to 15 Domestic Best Buy stores expected to close in fiscal 2025. The International segment, comprising operations in Canada, reported a 6.3% decline in comparable sales.
Best Buy's income tax expense increased in the first quarter of fiscal 2025, primarily due to reduced benefits from the resolution of tax matters and stock-based compensation. The effective tax rate for the period was 24.7%, up from 23.3% in the first quarter of fiscal 2024.
Looking ahead, Best Buy remains focused on its priorities for fiscal 2025, which include invigorating and progressing targeted customer experiences, driving operational effectiveness and efficiency, continuing a disciplined approach to capital allocation, and exploring incremental revenue streams. The company is also making efforts to provide personalized and motivational content to its app users, enhance in-store experiences, and drive operational efficiencies.
The market has reacted to these announcements by moving the company's shares -0.3% to a price of $87.92. For the full picture, make sure to review Best Buy's 10-Q report.
