Best Buy holiday shopping forecast constrained by supply issues



Best Buy said a shortage of some electronics items could hammer its business during the crucial holiday season.

The retailer on Tuesday projected weaker-than-expected estimates for its latest quarterly sales.

The forecast sent the retailer’s shares tumbling 13 percent, to $119.27, in mid-afternoon trading and reflected the toll of shipping logjams, shuttered factories and a scarcity of raw materials that have ripped through global supply chains this year.

Best Buy is facing supply constraints in categories such as appliances, mobile phones and gaming, Chief Executive Corie Barry said on a post-earnings call.

Microsoft and Sony have struggled to keep the latest versions of their gaming consoles in stock since their launch a year ago due to a widespread chip crunch, while some analysts have warned Apple’s latest iPhones could be in short supply during the holiday season.

Those devices are important for Best Buy as they sell in large numbers and act as a magnet for customers who often spend on other products.

New iPhones displayed in store
Some industry watchers project shoppers will have trouble finding the latest iPhone models.

“Getting hold of Apple’s latest iPhone or its new laptops is very challenging. These items should, in theory, be providing a nice lift to sales as the holidays approach, but stock levels remain low,” said Neil Saunders, managing director of research provider GlobalData.

The company — which as recently as August was predicting healthy growth — had included easier access to “hardest-to-find” products as a perk in a $200-a-year membership program launched last month to navigate the shortage.

But costs related to the program, increased expenditure to expedite some shipments and earlier Black Friday deals were expected to take a toll on its margins in the fourth quarter.

Best Buy forecast current-quarter comparable sales between a fall of 2 percent and a rise of 1 percent, the midpoint of which was below estimates of a 0.1 percent rise, according to Refinitiv data.

Its shares fell the most in intraday trading since the pandemic-driven selloff in March 2020.


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