The uncertainty surrounding the U.S. economic outlook dampens prospects for a resurgence in demand for TVs, laptops, and other electronic devices, prompting Best Buy to join peers in providing a timid yearly earnings prediction on Thursday.
According to Reuters, retailers in the United States provided larger discounts than usual during the holiday season to stimulate demand as rising rent and food expenses hammered non-essential spending during the last year.
Best Buy’s comparable sales fell 9.3% in the holiday quarter, slightly more than expected by Wall Street.
The business anticipates a 3% to 6% drop in comparable sales this year. Economists expected a 1.9% drop on average.
“As we enter fiscal 2024, macroeconomic headwinds will likely result in continued volatility, and we are preparing for another down year for the (consumer electronics) industry,” said Chief Executive Officer Corie Barry, according to the report.
Walmart, Target, and other retailers have also offered cautious estimates, raising concerns that the Federal Reserve would boost borrowing costs more to reduce demand.