Best Buy Revises Expected Q4 Operating Income as Tariffs Loom
Despite executives’ expressions of optimism, Best Buy is exercising caution as tariffs loom, revising its expected fourth quarter operating income downward and taking steps to mitigate the damage before it occurs. As peak season approaches and consumers begin to expect promotions and discounts, a raise in prices in response to tariffs poses a lot of risk.
But according to executives, Best Buy really just needs to ride out the effects of the trade war until next year. Much of its supply chain is already on its way out of China, so the tariffs will hit a lot less hard as time goes on.
Uncertainty stemming from the fourth tranche of tariffs set to take effect Sept. 1 and Dec. 15, and concerns over consumer willingness to pay higher prices “adds a level of caution to our outlook,” CEO Corie Barry said on the company’s Q2 earnings call Thursday.