Best Buy raises annual sales forecast on strong holiday demand

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(Reuters) -Electronics retailer Best Buy raised its annual sales and profit forecasts on Tuesday, banking on strong holiday demand as shoppers seize steep discounts to upgrade their laptops, smartphones and other household electronics.

Shares of the company were up 3% in premarket trading as it also beat comparable sales estimates for the third quarter.

Computing and tablets, which make up about a third of the retailer’s revenue, saw robust growth as consumers adopted new technology and replaced devices bought during the pandemic. Gaming demand also provided a lift, helped by the launch of Nintendo’s Switch 2 earlier this year.

The company has been expanding its online reach, rolling out a U.S. marketplace in August to broaden its product assortment and compete with larger e-commerce rivals. Domestic online sales grew 3.5% in the quarter, while international same-store sales rose 6.3%.

The retailer has implemented a range of strategies to blunt the impact of tariffs, including manufacturing flexibility, cost negotiations and supply chain diversification.

Recent earnings from big-box retailers Walmart, Target and Home Depot painted a mixed picture of U.S. retail. Walmart was buoyed by demand for essentials, while Target warned of muted holiday spending and Home Depot cited pressure from a sluggish housing market.

Best Buy now expects comparable sales for fiscal year 2026 to rise in the range of 0.5% to 1.2%, compared with its prior expectation of 1% drop to 1% rise.

It forecast adjusted profit-per-share of $6.25 to $6.35, compared with its prior target of $6.15 to $6.30.

Comparable sales for the quarter ended November 1 jumped 2.7%, beating analysts’ average estimate of a 1.62% rise, according to data compiled by LSEG.

(Reporting by Savyata Mishra in Bengaluru; Editing by Krishna Chandra Eluri)