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It’s been a tough spring for many retailers as consumers have worried about a possible recession and grown wary of constantly shifting trade policy. Now add Best Buy to that list.
On Thursday, the electronics and appliances giant reported declining sales. There were bright points, however. Best Buy still managed to beat Wall Street’s earnings expectations, posting adjusted EPS of $1.15 on $8.77 billion in revenue.
Even the sales decline portrayed an upbeat picture in some ways. Comparable sales fell only 0.7%, a far smaller drop than last year’s 6.1%. Online sales rose 2.1% and now make up nearly a third of U.S. revenue. Margins held steady, while services and memberships helped lift gross profits.
Despite these wins, Best Buy may be finding it impossible to plan in the most literal sense, with its tariff-related forecast arguably out of date within just hours.
Even a 12-hour window carries too much uncertainty
The company understandably flagged tariffs as a key risk in its updated FY26 outlook, saying it expects tariffs to stay at current levels — just hours after a federal court struck down much of Trump’s “Liberation Day” tariffs, demonstrating the constant whiplash that’s coming to define the business environment in 2025.
“We expect annual comparable sales growth to be in the range of down 1% to up 1%, and our adjusted operating income rate to be similar to last year at approximately 4.2%,” CFO Matt Bilunas said in the release. “Our underlying working assumptions are that tariffs stay at the current levels for the rest of the year, and there is no material change in consumer behavior from the trends we have seen in recent quarters. As you can imagine, and based on our history, we will continue to scenario-plan and adjust with agility as the situation evolves.”
And certainly, the situation is certainly evolving, one way or another.
Retail remains vulnerable to shifting tradewinds
Smooth projections aside, Best Buy may be especially vulnerable to tariffs because it sells big-ticket, delay-able items like TVs, laptops, and appliances, precisely the kinds of purchases consumers postpone when confidence dips or prices rise. Most of its inventory is imported from Asia, too, meaning suppliers may pass tariff-related costs down the chain. That scenario can put pressure on both margins and demand.
Upside is possible, too. A short-term sales bump can occur if shoppers try to buy before tariffs hit, though it could also be followed by a sharp post-tariff slowdown. Such a dynamic could account for Best Buy’s relatively strong quarter and suggest rougher waters ahead, depending on how the White House reacts to the court ruling and whether it attempts to impose tariffs through other means.
Shares of Best Buy are down 3% before Thursday’s bell.