By Dean Seal

Best Buy cut its sales and profit forecast for the year to account for the global trade war, dragging its shares down ahead of the opening bell.

The electronics retailer on Thursday said it now believes comparable sales could decline this year as a result of the new levies.

Best Buy has warned previously that its import-reliant vendors would likely pass higher costs onto the retailer, which in turn would have to raise prices to protect its already thin margins, putting pressure on demand.

The company's revised guidance assumes that tariffs stay at current levels for the rest of the year and that consumer spending stays consistent with the last few quarters, Chief Financial Officer Matt Bilunas said.

"As you can imagine, and based on our history, we will continue to scenario-plan and adjust with agility as the situation evolves," Bilunas said.

Shares slid 3.5% to $69 in premarket trading.

Best Buy now expects $41.1 billion to $41.9 billion in revenue for the fiscal year, down from its prior outlook for $41.4 billion to $42.2 billion, and for comparable sales to rise up to 1% or fall up to 1%, rather than come in flat or up 2% as previously estimated.

Full-year adjusted earnings are now on track to be $6.15 to $6.30 a share, instead of the $6.20 to $6.60 a share that Best Buy previously targeted.

For the quarter that ended May 3, sales ticked down about 1% to $8.77 billion, missing analyst projections for $8.81 billion, according to FactSet.

The Minneapolis company recorded a profit of $202 million, or 95 cents a share, compared with $246 million, or $1.13 a share, in the same quarter a year earlier.

Stripping out one-time items, adjusted earnings were $1.15 a share. Analysts polled by FactSet had been expecting $1.09 a share.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

May 29, 2025 07:41 ET (11:41 GMT)

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