Best Buy's Q1 FY26 Earnings: Delivering Better-Than-Expected Profitability Amid Dynamic Macroeconomic Factors
Best Buy, one of the world's leading consumer electronics retailers, has reported its first-quarter fiscal 2026 earnings, showcasing a steadfast approach to navigating dynamic macroeconomic factors. Despite revenue coming in slightly below last year's expectations, the company delivered better-than-expected profitability.
The company reported revenue of $8.8 billion, with an adjusted operating income rate of 3.8% and adjusted earnings per share of $1.15. This performance was driven by comparable sales growth in computing, mobile phones, and tablets, which offset declines in home theater, appliances, and drones.
Best Buy's omnichannel operations played a crucial role in supporting online sales, which grew year-over-year for the second consecutive quarter. These sales accounted for nearly 32% of total domestic sales, representing a slightly higher mix than last year. The company also achieved its strongest on-time ship-to-home delivery performance in three years.
Corie Barry, Best Buy's CEO, highlighted that customer behavior during Q1 remained consistent with previous commentary. Consumers continued to be deal-focused and attracted to more predictable sales moments. Despite dealing with persistent inflation, customers remain value-focused and thoughtful about big-ticket purchases.
The company also reported a material year-over-year improvement in its domestic relationship Net Promoter Score (NPS), which tracks consumers' likelihood to recommend Best Buy. This positive trend is attributed to the company's relentless focus on elevating its unique customer experience.
Regarding international trade, Best Buy acknowledged the ongoing uncertainty and complexities affecting the consumer electronics supply chain. The company estimates that approximately 30-35% of product COGS currently come from China, down from 55% in March. While developments in this area may have future impacts, Best Buy remains committed to navigating these challenges.
Best Buy's Q1 FY26 earnings demonstrate the company's ability to adapt and deliver profitability despite the complexities of the current macroeconomic environment. As the consumer electronics retail landscape continues to evolve, Best Buy's commitment to customer-centricity and operational excellence will be crucial in driving long-term success.
