Best Buy Co. Inc. (NYSE: BBY) reported first-quarter fiscal 2016 results before markets opened Thursday. The big-box retailer of electronics gear reported adjusted diluted earnings per share (EPS) of $0.37 and $8.56 billion in revenues. In the same period a year ago, Best Buy reported EPS of $0.35 on revenue of $8.64 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.29 and $8.46 billion in revenue.

On a GAAP basis, the company posted EPS of $0.10, compared with $1.33 in the year-ago quarter. Last year’s earnings included a benefit of $1.01 per share attributed to a change in the company’s European organization, and this year’s earnings included a $0.36 per share charge related to restructuring the Canadian business.

The company’s outlook continues to forecast same-store sales in its Enterprise division to be flat to down by low-single digits. The division posted same-store sales growth of 0.6% in the first quarter, down sequentially from a gain of 2%. All Canadian store revenue has been removed from the comparable sales base and the company’s International division no longer has a comparable metric, and will not have until the International division is again comparable on a year-over-year basis. We take that to mean at the end of the first quarter of fiscal 2017.

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Adjusted operating income continues to be forecast down 30 to 50 basis points. Best Buy’s chief financial officer enumerated four reasons for the forecast:

1. A flat to positive low single-digit revenue growth rate in domestic business
2. Higher year-over-year non-GAAP domestic SG&A spending
3. A revenue decline of 30% to 35% in the international business due to store closures and overall disruption from the Canadian brand consolidation in addition to the ongoing negative impact of foreign exchange rates
4. An International non-GAAP operating income rate in the range of negative 3.5% to negative 5.0%, again reflecting the near-term impacts of the Canadian restructuring.

The company’s CEO said:

While merchandising, marketing and operational execution were the tactical drivers of our better-than-expected first quarter financial results, strategically, we believe the cumulative impact of the progress we have made to improve our multi-channel customer experience is what has allowed us to consistently outperform the market. We have made real progress and it is showing up in our results.

Shares traded up about 9.5% in Tuesday’s premarket session, at $37.00, in a 52-week range of $25.50 to $42.00. Thomson Reuters had a consensus analyst price target of around $42.60 before the results were announced, with a high target of $50.00.

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