Best Buy used to be the head honcho in the electronics business, and even forced smaller competitors – such as Circuit City – out of the running. However, with advances in technology allowing customers to find better deals on websites like Amazon, the company has taken a nosedive, with a 90 percent drop in net income during the second quarter, according to the Los Angeles Times.
Earlier this week, Best Buy announced that it earned $12 million, or 4 cents per share, in the quarter that ended on August 4. In addition, revenue dropped to $10.55 billion and adjusted earnings were 20 cents per share. According to the news source, analysts had expected 31 cents per share on revenue of $10.65 billion.
Best Buy named Hubert Joly, the former head of Carlson – the hospitality and restaurant giant behind T.G.I. Friday's and Radisson – its new CEO in an attempt to resuscitate the business.
"Hubert was an outstanding candidate for this position and I am confident he will be a great fit for Best Buy," Hatim Tyabji, chairman of Best Buy's board, said in a statement. "Hubert’s range and depth of experience in transforming companies is exactly what the company needs at the moment, as is his energetic, imaginative and experienced leadership in executing strategies."
Even with Best Buy attempting to adjust to the changing needs of customers, some analysts believe it's too late to salvage the electronics company. Consumers are continuing to drift away from the big-box retail stores, opting to devote more shopping to surfing websites.
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