Best Buy says sales are better during pandemic, stock heads toward all-time high

Best Buy says sales are better during pandemic, stock heads toward all-time high

Best Buy Inc. announced Tuesday afternoon that sales have actually gained from last year despite the COVID-19 pandemic and promised permanent wage increases for employees, sending shares toward all-time highs in late trading.

The retail chain said that sales in the second quarter, from May 2 through July 18, increased 2.5% from the same period the year before, and were up 15% since stores began reopening June 15. Best Buy BBY, +2.15% said online sales jumped 255%, with purchases of computers, tablets and appliances driving the numbers, and that online sales remained 185% higher after stores reopened.

The company also announced that temporary pay hikes it gave employees will be baked in permanently. The company plans to increase wages 4% across the board for hourly employees below management level, and any employees who are not making $15 an hour after that increase will be raised to that level. Best Buy said that it had welcomed back roughly half of the 51,000 U.S. workers it had furloughed earlier in the pandemic, and extended free health benefits to workers who remain on furlough through Sept. 5.

“Strong consumer demand, combined with shopping experiences that emphasize safety and convenience, has helped produce our sales results to date,” Best Buy CEO Corie Barry said in a prepared statement. “None of this would be possible without the effort and energy of our front-line employees working in stores, supply chain facilities and customers’ homes.”

After closing with a 2.2% gain at $90.28, Best Buy shares jumped more than 5% in after-hours trading following the announcement. That gain would put Best Buy stock at a record high in the regular session: Shares closed at a record high of $91.93 on Feb. 20, before the beginning of a pandemic that has rocked retail chains.

See also: Tech has been a pandemic savior, but what happens next?

Best Buy’s emphasis on electronics is likely helping, however, as people rely on their gadgets and home appliances more while sheltering in place. Third-party analyses have shown strong gains in shipments of personal computers especially.

Analysts on average expected Best Buy’s second-quarter revenue to drop more than 7% from last year to $8.87 billion, according to FactSet. The company expects to report second-quarter earnings in full on Aug. 25.

Originally published on MarketWatch

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