Best Buy Crushes Earnings Expectations, But Here's the Catch

Best Buy just dropped its Q3 results, and the headline is mixed. Profit tanked 49% YoY (down to $140M from $273M), but adjusted EPS came in at $1.40—beating analyst estimates of $1.31 by a solid margin. Revenue also overshot expectations at $9.67B vs. Street’s $9.59B target.

Here’s what’s got traders excited: management just raised FY26 guidance significantly.

The Upgraded Outlook

Adjusted EPS: Now projecting $6.25-$6.35 (vs. prior $6.15-$6.30)

• Analysts were modeling $6.26, so BBY is essentially back on track

Revenue: $41.65B-$41.95B (raised from $41.1B-$41.9B)

• Street consensus: $41.8B

Comp sales growth: 0.5%-1.2% (flipped from negative guidance)

• This signals momentum heading into holiday season

Adjusted operating margin: Holding steady at ~4.2%

Q4 Outlook & Dividend

For the current quarter, management expects comp sales to basically flatline (down 1% to up 1%), with operating margins between 4.8%-4.9%.

Bonus: The board authorized a $0.95/share quarterly dividend (payable Jan 6), showing confidence despite the messy quarter.

The Reality Check

Shares dipped 1.3% pre-market to $74.64. Reason? The GAAP profit miss is real—down 49% YoY. That raw number can’t be spun as adjusted metrics usually can.

But the upgraded comp sales guidance and stronger FY26 revenue projection suggest Best Buy is navigating the consumer spending slowdown better than feared. Whether that holds through the holiday rush remains the key question.