Enterprise Comparable Sales Increased 1.6%

GAAP Diluted EPS Increased 3% to $0.89

Non-GAAP Diluted EPS Increased 19% to $1.08

Raises Full-Year Non-GAAP Diluted EPS Guidance Range to $5.60 to $5.75

MINNEAPOLIS, August 29, 2019 — Best Buy Co., Inc. (NYSE: BBY) today announced results for the 13-week second quarter ended August 3, 2019 (“Q2 FY20”), as compared to the 13-week second quarter ended August 4, 2018 (“Q2 FY19”).

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Q2 FY20 Q2 FY19 Revenue ($ in millions) Enterprise $ 9,536 $ 9,379 Domestic segment $ 8,821 $ 8,639 International segment $ 715 $ 740 Enterprise comparable sales % change1 1.6% 6.2% Domestic comparable sales % change1 1.9% 6.0% Domestic comparable online sales % change1 17.3% 10.1% International comparable sales % change1 (1.9)% 7.6% Operating Income GAAP operating income as a % of revenue 3.3% 3.6% Non-GAAP operating income as a % of revenue 4.0% 3.8% Diluted Earnings per Share (“EPS”) GAAP diluted EPS $ 0.89 $ 0.86 Non-GAAP diluted EPS $ 1.08 $ 0.91

For GAAP to non-GAAP reconciliations of the measures referred to in the above table, please refer to the attached supporting schedule Reconciliation of Non-GAAP Financial Measures.

“For the second quarter, we are reporting comparable sales growth of 1.6% on top of a very strong 6.2% last year,” said Corie Barry, Best Buy CEO. “We also delivered improved profitability driven by gross profit rate expansion and continued disciplined expense management, demonstrating the culture we have built around driving cost reductions and efficiencies to help fund investments. I would like to thank all of our associates for delivering strong first half results.”

Barry continued, “During the quarter, we continued to make progress on our Building the New Blue strategy and our purpose to enrich lives through technology. We expanded our commitment to the health and wellness category through expanded assortment and a second acquisition, grew our Total Tech Support membership, added In-Home Advisors and continued to transform our supply chain to improve our speed of delivery to customers. We are excited about our strategic business opportunities and look forward to updating the market on the progress of our strategy during our Investor Update on September 25.”

Best Buy CFO Matt Bilunas commented, “The updated FY20 guidance we are providing today narrows our prior top-line range and raises the bottom-line range. This updated guidance factors in the following: (1) our best estimate of the impact of recent announcements regarding tariffs on goods from China, including the increase to 30% for List 3 and 15% for List 4; (2) our better-than-expected first half earnings; and (3) general uncertainty related to overall customer buying behavior in the back half of the year.”

FY20 Financial Guidance

Best Buy is updating its full-year FY20 financial outlook to the following:

Enterprise revenue of $43.1 billion to $43.6 billion, which compares to prior guidance of $42.9 billion to $43.9 billion

Enterprise comparable sales growth of 0.7% to 1.7%, which compares to prior guidance of 0.5% to 2.5%

Enterprise non-GAAP operating income rate flat to slightly up from the 4.6% rate in FY19 2

Non-GAAP effective income tax rate of approximately 24.0% 2 , which compares to prior guidance of approximately 24.5%

, which compares to prior guidance of approximately 24.5% Non-GAAP diluted EPS of $5.60 to $5.752, which compares to prior guidance of $5.45 to $5.65

Best Buy is providing the following Q3 FY20 financial outlook:

Enterprise revenue of $9.65 billion to $9.75 billion

Enterprise comparable sales growth of 0.5% to 1.5%

Non-GAAP effective income tax rate of approximately 26.5% 2

Diluted weighted average share count of approximately 267 million

Non-GAAP diluted EPS of $1.00 to $1.052

Domestic Segment Q2 FY20 Results

Domestic Revenue

Domestic revenue of $8.82 billion increased 2.1% versus last year. The increase was driven by comparable sales growth of 1.9% and revenue from GreatCall, Inc. (“GreatCall”), which was acquired in Q3 FY19, partially offset by the loss of revenue from 13 large-format store closures in the past year.

The largest comparable sales growth drivers were appliances, tablets, headphones and services. These drivers were partially offset by declines in the gaming and home theater categories.

Domestic online revenue of $1.42 billion increased 17.3% on a comparable basis primarily due to higher average order values and increased traffic. As a percentage of total Domestic revenue, online revenue increased approximately 210 basis points to 16.1% versus 14.0% last year.

Domestic Gross Profit Rate

Domestic gross profit rate was 24.0% versus 23.8% last year. The gross profit rate increase of approximately 20 basis points was primarily driven by the impact of GreatCall’s higher gross profit rate, which was partially offset by higher supply chain costs.

Domestic Selling, General and Administrative Expenses (“SG&A”)

Domestic GAAP SG&A was $1.76 billion, or 19.9% of revenue, versus $1.71 billion, or 19.8% of revenue, last year. On a non-GAAP basis, SG&A was $1.74 billion, or 19.7% of revenue, versus $1.71 billion, or 19.8% of revenue, last year. Both GAAP and non-GAAP SG&A increased primarily due to GreatCall operating expenses and higher advertising expenses, which were partially offset by lower incentive compensation expenses. Additionally, GAAP SG&A in Q2 FY20 included an additional $18 million of intangible asset amortization and $3 million of transaction costs related to the company’s acquisitions of GreatCall and Critical Signal Technologies, Inc.

International Segment Q2 FY20 Results

International Revenue

International revenue of $715 million decreased 3.4% versus last year. This decrease was primarily driven by a comparable sales decline of 1.9%, which was driven by Canada, and the impact of approximately 120 basis points of negative foreign currency exchange rates.

International Gross Profit Rate

International gross profit rate was 23.8% versus 23.1% last year. The gross profit rate increase of approximately 70 basis points was primarily due to Canada, which was largely driven by increased revenue in the higher margin rate services category.

International SG&A

International SG&A was $166 million, or 23.2% of revenue, versus $165 million, or 22.3% of revenue, last year.

Restructuring Charges

Restructuring charges of $48 million in Q2 FY20 primarily relate to changes in the company’s Domestic retail operating model. In the prior year, restructuring charges of $17 million relate to the closure of the company’s Domestic Best Buy Mobile stores.

Dividends and Share Repurchases

In Q2 FY20, the company returned a total of $363 million to shareholders through share repurchases of $230 million and dividends of $133 million. On a year-to-date basis, the company has returned a total of $595 million to shareholders through share repurchases of $328 million and dividends of $267 million. On February 27, 2019, the company announced the intent to spend between $750 million and $1 billion on share repurchases in FY20.

Income Taxes

In Q2 FY20, the GAAP effective tax rate was 22.3% versus 25.7% last year. On a non-GAAP basis, the effective tax rate was 22.8% versus 25.4% last year. The lower GAAP and non-GAAP effective tax rates were primarily due to increased tax benefits associated with stock-based compensation and the resolution of certain discrete tax matters during the quarter.

Conference Call

Best Buy is scheduled to conduct an earnings conference call at 8:00 a.m. Eastern Time (7:00 a.m. Central Time) on August 29, 2019. A webcast of the call is expected to be available at www.investors.bestbuy.com , both live and after the call.

Investor Update Event

Best Buy is hosting an Investor Update beginning at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on September 25, 2019. The purpose of the event is to provide an update on the company’s Building the New Blue strategy. A webcast of the presentations and question and answer session will be available at www.investors.bestbuy.com , both live and after the event.

Notes:

(1) In Q1 FY20, the company refined its methodology for calculating comparable sales. It now reflects certain revenue streams previously excluded from the comparable sales calculation, such as credit card revenue, gift card breakage, commercial sales and sales of merchandise to wholesalers and dealers, as applicable. The impact of adopting these changes is immaterial to all periods presented, and therefore prior-period comparable sales disclosures have not been restated.

(2) A reconciliation of the projected non-GAAP operating income, non-GAAP effective income tax rate and non-GAAP diluted EPS, which are forward-looking non-GAAP financial measures, to the most directly comparable GAAP financial measures, is not provided because the company is unable to provide such reconciliation without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. These GAAP measures may include the impact of such items as restructuring charges; litigation settlements; goodwill impairments; gains and losses on investments; certain acquisition-related costs; and the tax effect of all such items. Historically, the company has excluded these items from non-GAAP financial measures. The company currently expects to continue to exclude these items in future disclosures of non-GAAP financial measures and may also exclude other items that may arise (collectively, “non-GAAP adjustments”). The decisions and events that typically lead to the recognition of non-GAAP adjustments, such as a decision to exit part of the business or reaching settlement of a legal dispute, are inherently unpredictable as to if or when they may occur. For the same reasons, the company is unable to address the probable significance of the unavailable information, which could be material to future results.

Forward-Looking and Cautionary Statements:

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that reflect management’s current views and estimates regarding future market conditions, company performance and financial results, operational investments, business prospects, new strategies, the competitive environment and other events. You can identify these statements by the fact that they use words such as “anticipate,” “believe,” “assume,” “estimate,” “expect,” “intend,” “foresee,” “project,” “guidance,” “plan,” “outlook,” and other words and terms of similar meaning. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from the potential results discussed in the forward-looking statements. Among the factors that could cause actual results and outcomes to differ materially from those contained in such forward-looking statements are the following: competition (including from multi-channel retailers, e-commerce business, technology service providers, traditional store-based retailers, vendors and mobile network carriers), our expansion strategies, our focus on services as a strategic priority, our reliance on key vendors and mobile network carriers, our ability to attract and retain qualified employees, changes in market compensation rates, risks arising from statutory, regulatory and legal developments, macroeconomic pressures in the markets in which we operate, failure to effectively manage our costs, our reliance on our information technology systems, our ability to prevent or effectively respond to a privacy or security breach, our ability to effectively manage strategic ventures, alliances or acquisitions, our dependence on cash flows and net earnings generated during the fourth fiscal quarter, susceptibility of our products to technological advancements, product life cycle preferences and changes in consumer preferences, economic or regulatory developments that might affect our ability to provide attractive promotional financing, interruptions and other supply chain issues, catastrophic events, our ability to maintain positive brand perception and recognition, product safety and quality concerns, changes to labor or employment laws or regulations, our ability to effectively manage our real estate portfolio, constraints in the capital markets or our vendor credit terms, changes in our credit ratings, any material disruption in our relationship with or the services of third-party vendors, risks related to our exclusive brand products and risks associated with vendors that source products outside of the U.S., including trade restrictions or changes in the costs of imports (including existing or new tariffs or duties and changes in the amount of any such tariffs or duties) and risks arising from our international activities.

A further list and description of these risks, uncertainties and other matters can be found in the company’s annual report and other reports filed from time to time with the Securities and Exchange Commission (“SEC”), including, but not limited to, Best Buy’s Annual Report on Form 10-K filed with the SEC on March 28, 2019. Best Buy cautions that the foregoing list of important factors is not complete, and any forward-looking statements speak only as of the date they are made, and Best Buy assumes no obligation to update any forward-looking statement that it may make.