Best Buy posts unexpected rise in first-quarter sales, boosted by demand for gaming and mobile products

Best Buy Co Inc (NYSE:BBY) saw its shares leap around 14% higher in pre-market New York trading as the firm reported an unexpected rise in first-quarter like-for-like sales, boosted by demand for gaming and mobile products, notably Nintendo Co.’s new Switch game console .

Best Buy  – the biggest US electronics retailer – said sales at stores open for more than a year rose by 1.6% in the first-quarter, confounding expectations for a 1.5% decline.

The Richfield, Minnesota-based group also said it expects second-quarter comparable sales to grow by 1.5%-2.5%.

Best Buy had warned in March that its first-quarter same-store sales would decline by about 1%-2%, as electronics retailers continue to fight competition from online stores.

Delayed federal tax refund checks helped revenues too

Aside from demand for gaining and mobile product, Best Buy’s chief executive Hubert Joly said the unexpected jump in sales also benefited from the arrival of delayed federal tax refund checks.

Best Buy said its overall revenue for the first-quarter climbed by 1% to US$8.53bn, beating the consensus estimate of US$8.28bn.

However,  Best Buy’s net income fell to US$188mln, or 60 US cents a share in the three months ended April 29, down from US$229mln, or 70 US cents per share a year earlier, but well above average expectations of 40 US cents per share.

In pre-market trading, Best Buy shares were 13.8% higher at US$57.37.

Story by ProactiveInvestors