Best Buy, the US electronics retailer, unveiled on Tuesday a sharper-than-expected rise in quarterly profits that sent shares surging by 15 per cent in early trading.
The Minneapolis-based group said its net earnings climbed to $198m in the quarter to July 30, from $164m in the same three-month period in 2015. Adjusted earnings per share, which excludes certain items, of 57 cents easily beat Wall Street expectations of 43 cents.
Revenues, meanwhile, ticked slightly higher to $8.5bn, also topping estimates of $8.4bn.
The upbeat results bolstered confidence that chief executive Hubert Joly’s turnaround effort that began about four years ago has not run out of momentum.
Best Buy, like other electronic retailers, has struggled to lure shoppers back to its stores and revive sales as the rise of online shopping has disrupted the retail industry and as consumers increasingly turn to online competitors like Amazon.
In response, Mr Joly has moved to cut costs and sell off overseas assets as he seeks to right the ship.
However, the stock had trimmed its year-to-date gains over the past week as the departure of Sharon McCollam — the company’s former chief financial officer who played a key role in the company’s turnround, earlier this year — and Mr Joly’s move to sell some of his shares in Best Buy, spooked investors.
Best Buy shares jumped 15.4 per cent in pre-market trading on Tuesday to $37.85.
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