Traditional technology retailers Best Buy and HP Inc. reported quarterly results on Thursday, offering a mixed view of consumer electronics demand and margin pressures tied to AI-related hardware shifts.
Best Buy posted adjusted earnings of $1.47 per share for its fiscal second quarter, beating the $1.39 Wall Street consensus. Revenue rose to nearly $9.8 billion from $9.4 billion a year earlier, while comparable sales increased 4.1%, double the prior-year growth rate. Management raised full-year adjusted EPS guidance to $6.70-$6.90, up from $6.30-$6.60 and above the $6.62 analyst consensus. Full-year revenue guidance was lifted to $42.3 billion-$42.8 billion.
Outgoing CEO Corie Barry said growth came across nearly all product categories and pointed to Best Buy Ads and Marketplace advertising as standouts. The company credited an AI-driven hardware upgrade cycle, as shoppers replace older computers and smartphones with AI-equipped devices. Despite the beat, shares fell about 2-3% in premarket trading, reflecting a roughly 31% year-to-date run ahead of the report.
HP Inc. reported fiscal third-quarter revenue of $15.7 billion, up 12.5% year over year and above estimates. Adjusted EPS was $0.83, also ahead of the $0.69 expected, but included an $0.11 per-share benefit from tariff refunds. Personal Systems revenue rose 18% to $11.8 billion, while PC unit shipments fell 16% as the company raised prices and focused on premium products, including AI PCs. Personal Systems operating margin declined to 4.6% from 5.2% in the prior quarter as memory and commodity costs increased faster than pricing could offset.
HP forecast fourth-quarter adjusted EPS of $0.69 to $0.79 versus a $0.67 estimate, but that includes an estimated $0.08 tariff refund benefit. Excluding that benefit, the midpoint would fall below market expectations. Full-year adjusted EPS guidance was raised to $3.19-$3.29, including an estimated $0.19 tariff refund benefit. HP shares fell about 5% in trading.
BofA Securities raised its HP price target to $21 from $18 while maintaining an Underperform rating, citing continued margin pressure excluding tariff benefits and uncertainty around HP’s leadership transition.
