Best Buy to shut 50 stores

MINNEAPOLIS — Best Buy said it plans to close 50 big-box stores and open 100 smaller locations focused on mobile technology in the U.S. in fiscal 2013 and cut $800 million in costs by fiscal 2015. The news came Thursday as the biggest U.S. specialty-electronics retailer posted a fiscal fourth-quarter loss partly due to restructuring charges, but its adjusted results topped Wall Street's expectations.

Best Buy's strategy of focusing on closing some of its hulking stores to concentrate on smaller Best Buy Mobile outlets illustrates the shifting nature of the electronics industry. Shoppers aren't flocking to big-box stores as they used to. And sales of TVs, digital cameras and video-game consoles have weakened, while sales of tablet computers, smartphones and e-readers have increased.

The company said it has not finalized which locations will be targeted for closure.

"We are quite deliberate and thoughtful when we make such decisions," Best Buy spokeswoman Susan Busch said. "We are working to ensure the impact to our employees will be as minimal as possible, while serving all customers in a convenient and satisfying way."

Busch said the company will announce details about specific store locations and timings for closings once they are finalized.

Best Buy operates 23 big-box stores and five mobile locations in Colorado, according to Best Buy spokeswoman Kelly Groehler. That total includes 19 big-box stores and four mobile stores in metro Denver.
Best Buy lost $1.7 billion, or $4.89 a share, for the period ended March 3. That compares with a profit of $651 million, or $1.62 a share, a year ago.

The Minneapolis-based company said its quarterly results included $2.6 billion in charges. They were mostly related to its purchase of Carphone Warehouse Group's interest in the Best Buy Mobile profit-sharing agreement and related costs, as well as an impairment charge tied to writing off Best Buy Europe goodwill and restructuring charges.

Taking these items out, adjusted earnings were $2.47 a share, above the $2.15 a share that analysts surveyed by FactSet forecast.

Revenue rose 3 percent to $16.08 billion but missed Wall Street's $17.18 billion estimate.
For the full year, Best Buy lost $1.23 billion, or $3.36 a share, compared with a profit of $1.28 billion, or $3.08 a share, in the prior year. Adjusted earnings were $3.64 a share, which tops the previous year's $3.43 a share.