The chain will open 42 new units in the third quarter, expanding into smaller markets than before, said Brian Dunn, president and COO. It is also is adding 142 Magnolia home-theater-oriented boutiques to existing stores in the third quarter, with a total of 150 new locations by year's end.
"The home theater is the new hearth of the American home," Dunn said.
Home video systems including high-definition plasma televisions, sound systems and DVD players have been a major boost to the bottom line, he said. The advice and service given at the Magnolia locations, including installation services, are vital to continued growth, particularly as prices continue to drop for the televisions.
The company reported earnings of $230 million for the quarter, up 22% over the previous year. Total revenue for the second quarter rose 13% to $7.6 billion, compared with $6.7 billion for the prior year's period. Domestic and international segments reported comparable store sales gains of 3% and 9.3%, respectively.
"Best Buy is performing well and growing because we're listening to our customers," Dunn said.
The chain also plans to expand its focus on services to small businesses, he added.
"Many small business owners don't know what they don't know about technology," Dunn said. "We believe we can help them like no one else can."
At the end of the second quarter, the company operated 771 Best Buys, 20 Magnolia Audio Video stores, 14 Pacific Sales showrooms and 12 Geek Squad stores in the United States. It also operated 119 Future Shop stores and 44 Best Buys in Canada, and 131 Five Star stores in China. Further growth outside the United States depends on a number of factors, including the ability to hire and train locals in technology and customer service.
"We see a tremendous opportunity internationally, but I see us growing slowly," Dunn said.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
