Best Buy Furloughing Hourly Employees Amid Store Closures; Stock Falls
Best Buy will furlough about 51,000 hourly store employees due to the coronavirus, said the company Wednesday. The retailer said sales since March 21 plunged 30% from a year earlier after the company began restricting in-person sales to curbside pickup.…
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Fiscal Q1 ends early May. COVID-19 sent March retail sales at electronics and appliance stores plunging 15.1% from February and 16.2% from March 2019, reported the National Retail Federation Wednesday. Executive salaries are being cut. Furloughs will affect hourly store employees and nearly all part-time employees, Best Buy said. It's keeping 82% of its full-time store and field employees on the payroll, including most in-home advisers and Geek Squad personnel. “The situation we are all facing as a result of the COVID-19 pandemic is truly unprecedented,” said CEO Corie Barry. All of Best Buy’s U.S. stores are closed to customer traffic, with 40 closed completely, mostly in the Northeast, “for at least 10 days at our discretion,” Barry said. Online domestic sales are up more than 250%, with half of those sales coming from customer pickup at stores, Barry said. The situation remains “very fluid and there is still a great deal of uncertainty,” Barry said, referencing depth and duration of store closures “and consumer confidence over time.” Wedbush Securities analyst Michael Pachter emailed investors that upcoming tech innovations the retailer expected to benefit from near term “will be delayed by supply chain disruptions and muted by a looming recession.” That could extend the timeline for the retailer to meet long-term targets, said analyst Michael Pachter. Shares Wednesday closed down 7.3% to $64.76.