POSTED: 01:30 a.m. HST, Mar 02, 2013
NEW YORK » Best Buy Co. lost less money in the fourth quarter as efforts by new CEO Hubert Joly to make the company more efficient showed glimmers of paying off.
The struggling electronics chain also said Friday that it did not receive a buyout bid from its co-founder Richard Schulze by the deadline Thursday, resolving one question mark that had been hovering over the Minneapolis company.
The retailer's fourth-quarter results beat expectations, but Best Buy gave a cautious outlook on the first quarter because it is ramping up investments and the timing of some sales has changed from last year.
U.S. revenue in stores open at least 14 months rose 0.9 percent, the best performance in 11 quarters, Joly said in an interview with the AP.
"We have momentum building. We're at the beginning of a transformation taking hold," Joly said.
Results may give investors more faith in new management, including Joly, who joined the company in August, and CFO Sharon McCollam, who joined in December, said NBG Productions analyst Brian Sozzi.
Earlier this week Minneapolis-based Best Buy announced 400 job cuts at its headquarters as part of a $725 million cost-cutting plan. On Friday the company said it expects to announce more job cuts later this year.
The company also said it plans $700 million to $800 million in capital spending and $150 million to $200 million in other expenses in fiscal 2014 as it invests in its business, mainly online and mobile channels. It plans to revamp Bestbuy. com by fiscal 2015.
"2014 is a year of transition," Joly said.
Its loss after paying preferred dividends totaled $409 million, or $1.21 per share, for the three months ended Feb. 2. That compares with a loss of $1.82 billion, or $5.17 per share, a year earlier.
Excluding restructuring and other costs, adjusted earnings came to $1.64 per share. Analysts expected $1.54 per share, according to FactSet.