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Best Buy blamed more intense competition on declining holiday revenue for the 2013 season. Total revenue during the holiday period dropped from the 2012 season.
The electronics retailer said that during the nine-week period at the end of 2013 through Jan. 4, 2014, its total revenue was $11.451 billion. That’s down from the same period a year ago, when the company saw $11.751 billion in revenue.
In a statement, CEO Hubert Joly blamed the intense Black Friday competition, which has continued to only drive prices further down during the holiday shopping season between Thanksgiving and Christmas.
“When we entered the holiday season, we said that price competitiveness was table stakes and an intensely promotional holiday season is what unfolded,” Joly said. “In both channels, the promotional intensity that began with Black Friday continued throughout the period, which led us and our competitors to answer one question – do we make the incremental investment necessary to be price competitive and defend our market share? For us, there was only one answer.”
Best Buy is hardly alone in seeing declining holiday numbers. The New York Times notes that many companies experienced almost no growth in 2013 and many were not helped by the slow holiday season. Sears was one company that was particularly hit hard, reporting a 9.2 percent drop in sales from the last holiday season.
Best Buy did note that Internet sales jumped 23.5 percent during the holidays, but that only made up $1.32 billion in revenue.
Today’s news caused Best Buy’s stock to plummet. Bloomberg reports that shares dropped 28 percent by 9:30 this morning.
image: Wikimedia Commons