Best Buy (BBY) is looking to better compete with online retailers such as Amazon (AMZN) this holiday season and will reportedly begin to match prices of its Internet-based competitors. The struggling electronics chain is also said to offer free home delivery on items that are out of stock in stores, according to The Wall Street Journal. The changes are part of the company’s efforts to decrease the growing percentage of people who browse Best Buy’s stores and then buy from online competitors, a practice known as “showrooming.” Best Buy estimates that the percentage of customers who showroom has increased about three percentage points in the last two years and now sits in the mid teens. The company believes that one in five showrooming shoppers makes a purchase in the store, however, and that number is expected to increase following the introduction of online price matching. More →
Those who thought they would be safe preordering an iPhone 5 from Best Buy (BBY) might be in for some bad news. 9to5Mac got its hands on an internal Best Buy memo that acknowledges the company won’t be able to fulfill its iPhone 5 preorders in a timely manner due to “current inventory allocation.” So what does that mean for customers who preordered their Apple (AAPL) smartphones through Best Buy? Apparently the company plans to have all its preorders fulfilled by mid-October, or “no later than 28 days from launch.” Maybe standing outside an Apple store all night makes a little more sense than we thought. More →
Best Buy (BBY) on Monday announced that it has reached an agreement with the company’s founder Richard Schulze that permits him to form an investment group and conduct due diligence. The Board of Directors is also prepared to offer Schulze two Board seats. The founder was given 60 days to propose a fully financed definitive agreement to the company, however if the proposal is rejected Schulze will not be able to pursue an acquisition until January 2013. Best Buy’s announcement comes shortly after the company named Hubert Joly its CEO and formally rejected Schulze’s initial takeover bid. Best Buy’s press release follows below. More →
Best Buy’s (BBY) major structural changes may be necessary, but the company is in for a rocky ride during this transitional period. The big box retailer on Tuesday reported that its second-quarter earnings in 2012 totaled $12 million, or $0.04 per share — roughly 91% lower than the $128 million, or $0.34 per share it reported in the second quarter of 2011. The company said the big reason for its decline in profits was that it paid $91 million in restructuring charges related to store closings. Best Buy’s revenues also declined to $10.5 billion in the quarter, down 3% from the $10.8 billion the company reported in Q2 2011. Needless to say, the company’s performance presents an immediate challenge for new Best Buy CEO Hubert Joly, who was officially appointed to the position on Monday. More →
Best Buy (BBY) on Monday announced that former Carlson boss Hubert Joly will take over as chief executive officer beginning next month. The retail giant’s former CEO, Brian Dunn, stepped down without warning this past April after the big-box retailer hit a rough patch and said during its fourth-quarter earnings call that it would shutter 50 U.S. stores. Now, The Wall Street Journal reports that Joly will be Dunn’s permanent replacement beginning in September. Best Buy still has an $8.5 billion buyout bid on the table from founder and former CEO Richard Schulze, though he is reportedly planning to revise his offer in an effort to make it more attractive. Joly stepped down from his CEO role at Carlson, which owns global franchises including Radisson and TGI Friday’s, on Sunday and former CFO Trudy Rautio will take his place, according to the Journal.
UPDATE: Barron’s is reporting that Best Buy has formally rejected Schulze’s buyout offer. The former CEO said he was “disappointed and surprised” by the company’s announcement and noted that he “will continue to pursue my proposal which will provide compelling value for shareholders and create new opportunities for customers and a bright future for Best Buy employees.” More →
Best Buy (BBY) founder Richard Schulze sees the writing on the wall: the era of big-box consumer electronics stores is coming to an end. The Wall Street Journal reports that Schulze wants to dramatically pare down his stores’ floor space, cut prices to remain competitive with Amazon (AMZN) and to make “in-store customer-service experience is as good as” Apple’s (AAPL). WSJ reports that Schulze’s plan is dauntingly ambitious and will involve shuttering at least 50 big-box stores and cutting costs by $800 million by 2015. Such changes would could have a negative impact on Best Buy’s bottom line, which is why Schulze is considering taking the company private again so that he can focus on the big picture and make necessary changes without facing pressure from Wall Street. More →
Best Buy (BBY) founder and the company’s largest shareholder Richard Schulze has offered as much as $8.5 billion to take the company private, Bloomberg reported on Monday. Schulze had been rumored to be preparing a takeover offer for some time, and he recently assembled a team of executives that will run the company if his buyout offer is approved. His offer amounts to between $24 and $26 per share, a premium of as much as 47% over Best Buy’s stock price at Friday’s close. Shares of Best Buy jumped 24.55% to $21.97 in pre-market trading on news of Schulze’s offer. More →
Best Buy (BBY) founder Richard Schulze plans to take the massive nationwide retailer private once again, and he is reportedly recruiting a team of executives to help revitalize the company if his effort is successful. An earlier report from June revealed Schulze’s intentions, suggesting that the former board chairman was planning a buyout to turn the struggling retailer’s business around and prevent his stake in the company, which currently sits at 20%, from losing more value. Now, Bloomberg adds on to the report, citing a senior Best Buy executive in stating that Schulze is building a new executive team that will be put in place if his buyout succeeds. “He is talking to people he trusts,” J.D. Wilson, SVP of enterprise capabilities, told Bloomberg. “There is a small group he’d like to have with him in righting the ship. He is serious as a heart attack.” More →
Best Buy plans to lay off approximately 2,400 employees according to a recent report. Dow Jones Newswires on Friday reported that Best Buy will soon dismiss as many as 2,400 workers including 600 Geek Squad representatives. Best Buy acquired Geek Squad, its PC repair arm, in 2002. “We are working to minimize the impact of the changes on employees while building the foundation for a strong future,” a Best Buy spokesperson told Dow Jones Newswires. Best Buy had 167,000 full-time employees at last count, including about 20,000 Geek Squad reps. The company announced during its fourth-quarter earnings call that it planned to close 50 U.S. stores as part of a cost-cutting effort. More →
Best Buy has decided to give its customers a little bit of relief if they decide to buy a new MacBook Pro with Retina display, though it will still cost them more than $2,000. As noted by 9to5Mac, Best Buy is knocking $110 off the new MacBook Pro’s sale price, bringing it down to $2,089.99. 9to5Mac also notes that Best Buy has discounted the new MacBook Air by $50, knocking its price down to $949.99. But as PC World writes, these deals extend to in-store purchases only, so anyone looking to take advantage of this discount should get to their local Best Buy ASAP to make sure their they don’t miss out. More →
After ousting its CEO and closing a slew of stores, it’s safe to say that Best Buy has had a difficult year. As the company’s stock continues to tumble, its founder Richard Schulze is planning to try and take the company private, according to The Wall Street Journal. Schulze is the retailer’s largest shareholder with roughly a 20% stake in the company, and he resigned from his post as chairman of the board earlier this month. The founder fears his holdings will continue to decline unless major changes are made at the company, although the Journal’s sources claim he doesn’t want to run the troubled retailer again. A potential buyout will be rather pricey, however. Best Buy’s value currently sits at roughly $8 billion, so a buyout offer would likely have to come in as high as $11 billion to gain the interest of other shareholders, the Journal noted. More →
$99 Xbox 360 consoles just got a little bit easier to find. Xbox Live programming director Larry “Major Nelson” Hryb said on Tuesday that Microsoft is expanding its pilot program that lets customers pay just $99 for a 4GB Xbox 360 as long as they sign a two-year service agreement to pay $14.99 a month for an Xbox Gold subscription. While the $99 Xbox deal was initially only available in certain Microsoft retail stores, Hryb said it will soon be available in select Best Buy and Game Stop locations as well. Hryb made sure to emphasize that the $99 Xbox deal is still a pilot program and that gamers shouldn’t come to expect $99 consoles to become the new norm just yet. “This next phase of the pilot program will be limited in terms of both timing and the number of units available—we’re excited to forge new ground and explore a new retail model for Xbox 360, but also want to emphasize that this is a pilot period for the program,” he said. “Call your local Best Buy, GameStop or Microsoft Store if you’d like more information about how and where to purchase.” More →
Best Buy on Tuesday reported results for the first quarter of 2012. The electronics retail giant posted better-than-expected earnings per share, despite declining store sales. Revenue came in at $11.6 billion, ahead of analysts’ consensus of $11.52 billion, and non-GAAP earnings came in at $0.72 per share, up 11% from the same quarter in 2011 and beating the Street’s estimates of $0.59 per share. Domestic online revenue rose by 20%, and domestic mobile-phone sales increased by 13%. “Best Buy is in a turnaround, and the strategic priorities we laid out at the beginning of the year are just the first phase of the changes to come,” said Mike Mikan, CEO (interim) of Best Buy. “We know we have to better adapt to the new realities of the marketplace, and we are creating a long-term plan designed to make Best Buy more relevant with customers and position the company for sustained, profitable returns in the years ahead. First quarter results were in-line with our expectations, and we are reaffirming our previously provided annual guidance for fiscal 2013.” Best Buy’s press release follows below.