Best Buy shares surged on Wednesday after the company reported earnings for the fourth quarter that topped analysts' expectations, fueled by sales of wearables, appliances and smart home devices during the holidays.

The electronics retailer said sales also got a boost from the somewhat unexpected popularity of the "Fortnite" video game, which drove purchases of gaming consoles and accessories like headphones. The crazed reaction to the game was "a material change versus [Best Buy's] original expectations," CFO Corie Barry said.

Best Buy's stock was climbing more than 16 percent by Wednesday afternoon. As of Tuesday's market close, the stock had fallen nearly 17 percent over the past 12 months, bringing Best Buy's market cap to about $6.2 billion.

The electronics retailer has been making investments to keep its prices competitive, offer more services — like its in-home tech support — to shoppers, and bulk up its supply chain to be able to fulfill online orders from the back of its stores. Best Buy's latest quarterly results show evidence those investments are paying off.

"Our customers are noticing the improved experience we provide them as they interact with us digitally, in stores or in their homes," CEO Hubert Joly said.

For the fourth quarter ended Feb. 2, Best Buy said net income rose to $735 million, or $2.69 per share, from $364 million, or $1.23 a share, a year ago. Excluding one-time items, Best Buy earned $2.72 a share, topping expectations for $2.57, based on a survey by Refinitiv data.

Revenue fell to $14.80 billion during the quarter from $15.36 billion a year ago. But that was still ahead of expectations for $14.70 billion. The fourth quarter of 2018 included one less week than in 2017, Best Buy said.

Sales at Best Buy stores open for at least 12 months were up 3 percent, topping expectations for growth of 2 percent. The company has now reported eight consecutive quarters of same-store sales gains. It said same-store sales were up 4.8 percent in fiscal 2019.

Looking to fiscal 2020, Best Buy is calling for earnings per share of between $5.45 and $5.65. Analysts were expecting earnings of $5.49 a share, on the low end of that range. Best Buy says same-store sales should be up as much as 2.5 percent this year, with annual revenue falling between $42.9 billion and $43.9 billion. Analysts were expecting sales of $43.39 billion.

Best Buy's 2020 outlook assumes tariffs stay at a current rate of 10 percent, Barry said. She said the tariffs that went into effect in September touched about 7 percent, or roughly $2.3 billion, of the retailer's cost of goods sold.

The company, meanwhile, expects to benefit as new devices like foldable smartphones hit stores. It also said it sees an opportunity to do more with health tech, following its acquisition of GreatCall, a company that makes cell phones for seniors.

"Digital health is an exciting area with enormous opportunity [for] the use of technology to help customers with their health, fitness, sleep, etc. — across multiple age groups, from babies to seniors," Joly said.

Best Buy also on Wednesday said it's raising its quarterly dividend by 11 percent, to 50 cents per share, and announced a new $3 billion share repurchase program.

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