Company: BBY
Filing Date: 2025-09-05
Form Type: 10-Q
Source: 0000764478-25-000040
Chunk: 100

Company: BEST BUY CO INC
Filing Date: 2025-09-05
Form: 10-Q
Item: Part II, Item 2
Chunk 100
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 a comparable sales decline in home theater.

•Appliances: The 5.7% comparable sales decline was driven primarily by small appliances.

•Entertainment: The 57.3% comparable sales growth was driven primarily by gaming.

•Services: The 2.2% comparable sales growth was driven primarily by growth in our membership programs.

International segment gross profit rate decreased in the second quarter and first six months of fiscal 2026, primarily due to lower product margin rates.

International segment adjusted SG&A in the second quarter of fiscal 2026 remained relatively unchanged from the second quarter of fiscal 2025. International segment adjusted SG&A decreased in the first six months of fiscal 2026, primarily due to the favorable impact of foreign exchange rates, mostly offset by higher employee compensation expense and expenses associated with Best Buy Express locations that opened after the second quarter of fiscal 2025.

International segment adjusted operating income rate decreased in the second quarter and first six months of fiscal 2026, primarily due to unfavorable gross profit rates, partially offset by increased leverage from higher sales volumes, which resulted in favorable adjusted SG&A rates.

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Consolidated Non-GAAP Financial Measures

Reconciliations of consolidated operating income, effective tax rate and diluted EPS (GAAP financial measures) to consolidated adjusted operating income, adjusted effective tax rate and adjusted diluted EPS (non-GAAP financial measures), respectively, were as follows ($ in millions, except per share amounts):

Three Months EndedSix Months EndedAugust 2, 2025August 3, 2024August 2, 2025August 3, 2024Operating income$251 $383 $470 $695 % of revenue2.7 %4.1 %2.6 %3.8 %Intangible asset amortization(1)4 5 9 11 Restructuring charges(2)114 (7)223 8 Adjusted operating income$369 $381 $702 $714 % of revenue3.9 %4.1 %3.9 %3.9 %Effective tax rate26.8 %25.8 %18.3 %25.3 %Intangible asset amortization(1)— %— %0.2 %— %Restructuring charges(2)0.9 %— %8.7 %— %Loss on disposal of subsidiaries