Falling short, Best Buy cites late iPhone debut

Best Buy has again failed to convince investors that it can prosper in an Amazon world.

The world’s largest electronics chain on Thursday posted third- quarter comparable sales that missed analysts’ estimates, as the major hurricanes in Texas and Florida trimmed revenue during the period. The retailer also said a later release date this year for Apple Inc.’ s iPhone affected its performance.

The results signal that all the company’s investments in customer satisfaction and its staff aren’t paying off fast enough in its battle with Amazon. com. Chief Executive Officer Hubert Joly arrived in 2012 with a plan to

cut costs while beefing up online operations and instore experience. While he’s experienced some success, five years on, investors want more. In September, he laid out a plan to increase revenue to $ 43 billion by 2020, but the stock still sold off.

The pressure is only going to increase as Best Buy heads into the holiday season, Moody’s Corp. analyst Charlie O’Shea said.

“The key for Best Buy to maximize its profitability,” he said. “Wal- Mart and Amazon continue their heavyweight battle for market share across many categories, with consumer electronics a key battleground.”

The iPhone’s November release pushed all the benefits into the current quarter and reduced sales in the previous period by more than $ 100 million, the company said. Revenue totaled $ 9.32 billion. With that added revenue, Best Buy would have surpassed analysts’ estimates

of $ 9.36 billion.

Same- store sales, a key investor metric that also includes Web purchases, rose 4.4 percent. Analysts expected 4.8 percent, according to Consensus Metrix. The storms that hit the U. S. in August and September reduced this measure by as much as 20 percentage points, the company said.

Excluding some items, profit of 78 cents a share met estimates, breaking a streak of 19 straight quarters in which it had exceeded expectations. The company also raised the top- end of its annual sales forecast to a gain of 4 percent to 4.8 percent. It had projected revenue to increase 4 percent.

As Best Buy heads into the core Christmas- shopping season, it hasn’t so far seen a big uptick in discounting by competitors from a year ago, the company said. That could bode well for a chain that tries to maintain profit margins during Christmas, even if it means fewer sales.

“Looking ahead, we are very excited about our plans for the holiday,” Joly said in a statement.