Best Buy shares soared more than 10% on Thursday after the consumer electronics retailer reported first-quarter fiscal 2026 results that significantly exceeded expectations. The stock closed at $72.98, up approximately 13% from the previous session, marking its largest single-day gain in nearly a year.

The earnings report showed Best Buy's first-quarter revenue reached $8.936 billion, a 1.9% year-over-year increase, surpassing the market consensus of $8.82 billion. Adjusted earnings per share were $1.28, also beating analyst estimates of $1.22. More notably, the company's comparable store sales grew by 2.0%, the strongest performance in four years, with the computer and tablet category seeing a 6% comparable sales increase and the mobile phone category also showing robust performance.

Best Buy CEO Corie Barry stated on the earnings call that the growth of its advertising business, Best Buy Ads, and its third-party e-commerce platform, Marketplace, were the primary drivers behind the better-than-expected quarterly results. She noted that the Marketplace platform attracted over 1,000 sellers within just three months of its launch, expanded its online catalog by 11 times, and maintained a return rate lower than that of the company's own operations.

International business also performed well, with revenue increasing 7.3% year-over-year and comparable sales growing 4.7%. The company reported that comparable sales growth from May to date has reached a high-single-digit percentage and projected overall growth of approximately 1.0% for the second quarter.

One of the most notable announcements in the report was Best Buy's decision to raise its quarterly dividend from $0.95 to $0.96, bringing the annualized dividend to $3.84. Based on the current stock price, the dividend yield is approximately 5.2%, which is considered high within the retail sector. Best Buy also announced plans to allocate approximately $300 million for share repurchases in fiscal 2027. The company reaffirmed its full-year guidance, expecting revenue between $41.2 billion and $42.1 billion and adjusted earnings per share in the range of $6.30 to $6.60.

For investors optimistic about the technology retail sector but seeking stable cash flow, Best Buy's dividend yield exceeding 5% makes it a compelling alternative to tech giants like Amazon, which do not pay dividends. Analysts pointed out that Best Buy's dividend payout ratio is around 51%, a healthy level that leaves room for future increases.

Best Buy's stock has risen about 20% year-to-date, currently trading at a price-to-earnings ratio of approximately 14.8 times. Following the earnings report, institutions including JPMorgan upgraded their ratings on the stock, citing the company's differentiated strategy in the competitive e-commerce landscape as gradually yielding results.