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Best Buy Announces Revenue Dip, Claims #1 Kinect, Move Share

U.S. specialty retailer Best Buy attributed a 3% dip in same-store revenue partly to a larger 14% dip in video games, but claimed a "number one market share" in Kinect and Move sales.
U.S. specialty retail store chain Best Buy attributed slightly lower comparable store revenues in its third fiscal quarter partly to declining sales for video game hardware and software. "The gaming sector lagged our expectations," Best Buy CEO Brian Dunn said in a conference call accompanying their third fiscal quarter results, released today. "We did not perform as well on some of the new game titles as we had expected, especially coming off a 20-month high in market share a year ago driven by Wii and PS3 hardware and title sales." Domestic, comparable-store sales of video game software were down almost 14 percent at the big box electronics retailer for the quarter ending Nov. 27, 2010, with sales of consumer electronics (a category that includes game systems and products like TVs and Blu-Ray players) down just over 10 percent compared to the year before. Internationally, the retailer's entertainment software sales for the quarter were down nearly 15 percent, year over year, while consumer electronics was down only 2.5 percent. But Dunn was optimistic that the gaming sector could bounce back for Best Buy, citing new motion controllers as a particular area of sales strength. "We estimate that we have a number one [U.S. retailer] market share in Kinect and Move, which already has had a positive impact in November," he said as part of the call, transcribed by SeekingAlpha. Overall, the company saw $11.9 billion in revenue for the quarter, down 1.1 percent from 2009, with comparable store revenues down 3.3 percent year-over-year. Video game software sales made up 15 percent of domestic revenue and 6 percent of international revenue, to represent roughly $1.5 billion in sales overall. In August, Best Buy started selling used games at 600 stores nationwide, expanding a pilot program first started back in 2005.

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