At Best Buy, total revenues gained 17% to $9.9 billion, based on new-store openings and a heady 6.7% comparable-store sales gain. (Those gains stem from an additional week of post-Thanksgiving revenue, due to a calendar shift, as well as an increase to higher-ticket items.) And online, revenues surged 65% in the quarter. Domestic revenue grew 15%, and international revenue gained 32%. The company says its balance sheet benefited "from lower promotional costs in a more rational U.S. retail environment compared to last year, particularly in home theater."
Among the higher-ticket items that have been selling well are video gaming consoles, notebook computers, flat-panel TVs and GPS devices, leading company executives to raise the company's profit projections for the fourth quarter.
Despite such good news from one big-box retailer, other indicators are decidedly less positive. In its analysis of the first 20 days of the holiday shopping season, beginning with Black Friday, MasterCard Advisors' SpendingPulse is reporting a 5.8% increase in consumer spending electronics--well below the 15% increase observed in the weekend following Black Friday.
"Not surprisingly, Black Friday's sales came in so strong that the pace was clearly not sustainable," the company says in its release. Gas prices--32% higher than last year--appear to be a factor. "Our spending data suggests that high gas prices and oil costs have had an impact on discretionary spending."
A key soft spot is clothing. While specialty apparel was up 0.5% compared to last year, women's apparel was down 5.7% while men's apparel was up 4.5%. And luxury goods took a tumble, falling 3.7% from the same period a year ago--although MasterCard expects jewelry purchases, typically made in the final two weeks of the season, to pick up. Excluding jewelry sales, it says, luxury goods sales are up 10.8% compared with last year's spending.