Best Buy boosts pay as coronavirus drives sales
Largest areas of sales growth were in computing, appliance and tablet categories
Shares of Best Buy have surged more than 4 percent in after-hours trading Tuesday on news that the retailer's online sales rose 255 percent quarter-to-date through July 18 compared to the same period last year due to increased demand during the coronavirus pandemic.
“Strong consumer demand, combined with shopping experiences that emphasize safety and convenience, has helped produce our sales results to date,” Best Buy CEO Corie Barry said in a statement. “None of this would be possible without the effort and energy of our front-line employees working in stores, supply chain facilities and customers’ homes."
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According to the company, the largest areas of sales growth were in the computing, appliance and tablet categories.
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Since Best Buy began allowing customers to shop without an appointment at more than 800 stores across the United States starting June 15, the company's retail sales grew approximately 15 percent compared to the prior year, while online sales growth was approximately 185 percent compared to the prior year.
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The retailer noted that second-quarter sales are up about 2.5 percent through July 18, compared to the same period a year ago, including sales growth of 2 percent in the United States and 8 percent internationally.
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In addition, the company said it will begin increasing its starting hourly wage for all U.S. employees to $15 and give employees a 4 percent raise starting Aug. 2.
The move comes following temporary furloughs of approximately 51,000 Best Buy hourly store employees in the United States that began April 19. The company noted that it retained approximately 82 percent of its full-time store and field employees during that time, including the majority of In-Home Advisors and Geek Squad Agents.
Approximately half of the 51,000 domestic hourly employees returned from the furlough as of June 15. Meanwhile, the company has extended health benefits at no cost through Sept. 5 to the remaining furloughed employees currently enrolled in a company health plan.
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The company withdrew its guidance for fiscal 2021 in March and said it will provide additional business updates when it releases its fiscal second-quarter results on Aug. 25.