Best Buy signals waning stay-at-home demand

Best Buy is signaling a slowdown. The electronics retailer that saw strong demand for computing equipment amid the stay-at-home trend said Thursday it was – in its words – “difficult to predict how sustainable these trends will be.”

Best Buy’s CFO forecast comparable sales growth for the full year would range between a drop of 2% to a gain of 1%. Earlier this week, two other retailers whose sales shot up during the health crisis - Home Depot and Lowe’s - stayed away from providing specific forecasts.

Best Buy’s sobering forecast comes after sales surged as people stuck at home set up home offices and students switched to remote learning. That drove up demand for laptops, webcams, and other computer accessories last year.

That sales drive continued in the holiday quarter helped by demand for new gaming consoles from Sony and Microsoft.

But the momentum slowed markedly. The nearly 13% rise in comparable sales amounted to nearly half of the jump recorded in the previous quarter. Same-store sales as well as total revenue missed Wall Street’s expectations.

But it appears the company is making a bet on digital sales. The Wall Street Journal reported Thursday that the company has been laying off workers and cutting hours for some store workers as it adapts to the shift to e-commerce. Best Buy’s online sales nearly doubled in the latest quarter, making up 43% of U.S. sales.

Shares fell in early Thursday trading.