Best Buy second-quarter profit fell 19% - Flat Panel TV, Best Buy - HC Network Appliance Industry-hc

(BBY) announced that due to increase in expenditure, with notebook PCs and video game consoles such as increased sales of lower margin products, reported second-quarter profit fell 19% from a year earlier, worse than expected.

The Minnesota-based company reported second-quarter net income fell to 202 million U.S. dollars, 48 cents a share, a year earlier net income of 250 million U.S. dollars, 55 cents a share. Second-quarter sales of 8.75 billion U.S. dollars last year rose 12% to 98 million. Same-store sales, or sales at least 14 months or more stores, call centers and Web site sales, rose 4.2%.

Analysts polled by Thomson expect the company's second quarter profit of 56 cents per share on sales of 9.7 billion.

At 9:42 am EST, the company's shares fell 2.70 U.S. dollars to 41 dollars, down 6.2%.

The company said second-quarter profit growth in expenditure is the leading reasons for the decline. The company's 973 U.S. Best Buy stores launched mobile (BestBuyMobile) business, and prepared in Mexico and Turkey launched the first store. The company announced that, despite the investment in growth projects remains unchanged, but the second half of the priority spending will be reduced. The company announced that its expenses will be used for Best Buy Mobile and other growth items, the company hopes these projects will be its U.S. market share by 1.6 percentage points.

"As the macroeconomic environment, poor management of our expenditure in a lot of work to be completed," Best Buy CEO Brad - Anderson (BradAnderson) said in a statement.

The company still will all profit per share is expected to set in between 3.25 to 3.40 U.S. dollars, but expect same-store sales growth in the second half will be lower than in the first half, due to poor macroeconomic environment and the U.S. government's economic stimulus program is nearing completion. In addition, this year's Thanksgiving shopping season in the fourth quarter, it expects third-quarter same-store sales will be down 2% to 3%.

Acquire Napster

Analysts also pointed out that since
Flat Panel TV
Oversupply may lead to falling prices, the company will face more pressure forecast. Hope Best Buy has been flat
TV
Sales growth can help increase the average price per unit of product.

"We are increasingly worried about LCD TV supply chain, there is the problem of excess inventory and more challenging demand environment will force retailers to increase the discount promotion efforts," said UBS Securities analyst Brian - Nagel (BrianNagel) said. Last week, the analyst will be Best Buy's stock rating to "buy" to "neutral."

Selling, general and administrative expenses from the sales of 19.9% to 20.8%.

The company also is preparing to sell cellular phones and other wireless equipment products Best Buy to expand mobile services to Canada. Mobile phones and the service is to promote
Fitting
The three-digit comparable store sales increase, while mobile phones and accessories is currently the company's most profitable product.

The company also planned to increase spending on global positioning system equipment to the sale of space to adjust and increase store sales staff input. In the U.S., the company also added the Apple store products store and musical instrument stores. Monday, the company agreed to buy digital music provider NapsterInc., Purchase price of 54 million U.S. dollars. This will not only help them win about 70 million subscribers, has also expanded its online music business, and may make the service has been applied in the mobile phone.

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