UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


(Mark One)
	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~May~~August 43, 2024


	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 1-9595

A black text with a yellow tag

Description automatically generated

BEST BUY CO., INC.

(Exact name of registrant as specified in its charter)


Minnesota		41-0907483
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7601 Penn Avenue South
Richfield, Minnesota		55423
(Address of principal executive offices)		(Zip Code)

(612) 291-1000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol	Name of exchange on which registered
Common Stock, $0.10 par value per share	BBY	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer 	Accelerated Filer 		Non-accelerated Filer 

Smaller Reporting Company 		Emerging Growth Company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 

The registrant had ~~215~~214,~~713~~725,~~754~~246 shares of common stock outstanding as of ~~June~~September 54, 2024.

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Table of Contents

BEST BUY CO., INC.

FORM 10-Q FOR THE QUARTER ENDED ~~MAY~~AUGUST 43, 2024

TABLE OF CONTENTS

Part I — Financial Information				3
Item 1.		Financial Statements		3
	a)	Condensed Consolidated Balance Sheets as of ~~May~~August 43, 2024, February 3, 2024, and ~~April~~July 29, 2023		3
	b)	Condensed Consolidated Statements of Earnings for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023		4
	c)	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023		5
	d)	Condensed Consolidated Statements of Cash Flows for the ~~three~~six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023		6
	e)	Condensed Consolidated Statements of Changes in Shareholders' Equity for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023		7
	f)	Notes to Condensed Consolidated Financial Statements		8
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3.		Quantitative and Qualitative Disclosures About Market Risk		2324
Item 4.		Controls and Procedures		24
Part II — Other Information				24
Item 1.		Legal Proceedings		24
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		2425
Item 5.		Other Information		2425
Item 6.		Exhibits		25
Signatures			26

WEBSITE AND SOCIAL MEDIA DISCLOSURE

We disclose information to the public concerning Best Buy, Best Buy’s products, content and services and other items through our websites in order to achieve broad, non-exclusionary distribution of information to the public. Some of the information distributed through this channel may be considered material information. Investors and others are encouraged to review the information we make public in the locations below.* This list may be updated from time to time.

For information concerning Best Buy and its products, content and services, please visit: https://bestbuy.com.

For information provided to the investment community, including news releases, events and presentations, and filings with the SEC, please visit: https://investors.bestbuy.com.

For the latest information from Best Buy, including press releases, please visit: https://corporate.bestbuy.com/archive/.

* These corporate websites, and the contents thereof, are not incorporated by reference into this Quarterly Report on Form 10-Q nor deemed filed with the SEC.

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Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

Condensed Consolidated Balance Sheets

$ in millions, except per share amounts (unaudited)

	May 4, 2024		February 3, 2024		April 29, 2023
	August 3, 2024		February 3, 2024		July 29, 2023
Assets
Current assets
Cash and cash equivalents	$	1,~~214~~387	$	1,447	$	1,~~030~~093
Receivables, net		~~770~~871		939		~~860~~856
Merchandise inventories		5,~~225~~706		4,958		5,~~219~~651
Other current assets		~~544~~598		553		~~653~~704
Total current assets		78,~~753~~562		7,897		78,~~762~~304
Property and equipment, net		2,~~196~~183		2,260		2,~~321~~305
Operating lease assets		2,~~771~~860		2,758		2,~~694~~813
Goodwill		1,383		1,383		1,383
Other assets		~~649~~636		669		~~528~~513
Total assets	$	1415,~~752~~624	$	14,967	$	1415,~~688~~318
Liabilities and equity
Current liabilities
Accounts payable	$	45,~~664~~542	$	4,637	$	45,~~874~~471
Unredeemed gift card liabilities		~~242~~243		253		~~256~~250
Deferred revenue		~~923~~940		1,000		~~1,015~~996
Accrued compensation and related expenses		~~380~~347		486		~~364~~377
Accrued liabilities		~~812~~756		902		~~759~~709
Current portion of operating lease liabilities		~~613~~610		618		~~625~~615
Current portion of long-term debt		1513		13		15
Total current liabilities		78,~~649~~451		7,909		78,~~908~~433
Long-term operating lease liabilities		2,~~222~~316		2,199		2,~~128~~254
Long-term debt		1,~~134~~157		1,152		1,~~155~~145
Long-term liabilities		~~665~~593		654		~~704~~651
Contingencies (Note 10)
Equity
Best Buy Co., Inc. Shareholders' Equity
Preferred stock, $1.00 par value: Authorized - 400,000 shares; Issued and outstanding - none		-		-		-
Common stock, $0.10 par value: Authorized - 1.0 billion shares; Issued and outstanding - 216.1 million, 215.4 million and 218.5 million shares, respectively		22		22		22
Common stock, $0.10 par value: Authorized - 1.0 billion shares; Issued and outstanding - 215.0 million, 215.4 million and 217.9 million shares, respectively		22		22		22
Additional paid-in capital		26-		31		-
Retained earnings		2,~~722~~775		2,683		2,~~454~~491
Accumulated other comprehensive income		~~312~~310		317		~~317~~322
Total equity		3,~~082~~107		3,053		2,~~793~~835
Total liabilities and equity	$	1415,~~752~~624	$	14,967	$	1415,~~688~~318

NOTE: The Consolidated Balance Sheet as of February 3, 2024, has been condensed from the audited consolidated financial statements.

See Notes to Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Earnings

$ and shares in millions, except per share amounts (unaudited)

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Revenue	$	89,~~847~~288	$	9,~~467~~583	$	18,135	$	19,050
Cost of sales		67,~~783~~102		7,~~317~~363		13,885		14,680
Gross profit		2,~~064~~186		2,~~150~~220		4,250		4,370
Selling, general and administrative expenses		1,~~737~~810		1,~~848~~879		3,547		3,727
Restructuring charges		15(7)		(97)		8		(16)
Operating income		~~312~~383		~~311~~348		695		659
Other income (expense):
Investment income and other		25		21
Gain on sale of subsidiary, net		-		21		-		21
Interest expense		(12)		(12)
Investment income and other		21		12		46		33
Earnings before income tax expense and equity in income (loss) of affiliates		325		320
Interest expense		(13)		(12)		(25)		(24)
Income tax expense		80		75
Earnings before income tax expense and equity in income of affiliates		391		369		716		689
Equity in income (loss) of affiliates		1		(1)
Income tax expense		101		96		181		171
Net earnings	$	246	$	244
Equity in income of affiliates		1		1		2		-
Basic earnings per share	$	1.14	$	1.11
Net earnings	$	291	$	274	$	537	$	518
Diluted earnings per share	$	1.13	$	1.11
Basic earnings per share	$	1.35	$	1.25	$	2.49	$	2.37
Weighted-average common shares outstanding:
Diluted earnings per share	$	1.34	$	1.25	$	2.47	$	2.36
Basic		216.2		218.9
Weighted-average common shares outstanding:
Diluted		217.2		219.9
Basic		216.0		218.6		216.1		218.7
Diluted		217.1		219.0		217.2		219.5

See Notes to Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Comprehensive Income

$ in millions (unaudited)

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Net earnings	$	~~246~~291	$	~~244~~274	$	537	$	518
Foreign currency translation adjustments, net of tax		(52)		(5)		(7)		-
Comprehensive income	$	~~241~~289	$	~~239~~279	$	530	$	518

See Notes to Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Cash Flows

$ in millions (unaudited)

	Three Months Ended
	Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023
Operating activities
Net earnings	$	~~246~~537	$	~~244~~518
Adjustments to reconcile net earnings to total cash provided by (used in) operating activities:
Adjustments to reconcile net earnings to total cash provided by operating activities:
Depreciation and amortization		~~219~~437		~~237~~473
Restructuring charges		158		(916)
Stock-based compensation		3874		3875
Other, net		12		14
Gain on sale of subsidiary, net		-		(21)
Other, net		12		2
Changes in operating assets and liabilities:
Receivables		~~168~~66		~~279~~289
Merchandise inventories		(~~273~~761)		(86508)
Other assets		(811)		(1732)
Accounts payable		43904		(~~790~~206)
Income taxes		13(183)		46(148)
Other liabilities		(~~317~~266)		(~~287~~245)
Total cash provided by (used in) operating activities		156		(331)
Total cash provided by operating activities		817		181
Investing activities
Additions to property and equipment		(~~152~~335)		(~~204~~395)
Other, net		(15)		-
Net proceeds from sale of subsidiary		-		14
Total cash used in investing activities		(167)		(204)
Other, net		(17)		-
Total cash used in investing activities		(352)		(381)
Financing activities
Repurchase of common stock		(50148)		(79158)
Dividends paid		(~~202~~405)		(~~202~~402)
Total cash used in financing activities		(252)		(281)
Other, net		(4)		-
Effect of exchange rate changes on cash and cash equivalents		(3)		(5)
Total cash used in financing activities		(557)		(560)
Decrease in cash, cash equivalents and restricted cash		(266)		(821)
Effect of exchange rate changes on cash and cash equivalents		(3)		(2)
Decrease in cash, cash equivalents and restricted cash		(95)		(762)
Cash, cash equivalents and restricted cash at beginning of period		1,793		2,253
Cash, cash equivalents and restricted cash at end of period	$	1,~~527~~698	$	1,~~432~~491

See Notes to Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Changes in Shareholders' Equity

$ and shares in millions, except per share amounts (unaudited)

	Common Shares		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total
Balances at February 3, 2024		215.4	$	22	$	31	$	2,683	$	317	$	3,053
Net earnings, three months ended May 4, 2024		-		-		-		246		-		246
Other comprehensive loss:
Foreign currency translation adjustments, net of tax		-		-		-		-		(5)		(5)
Stock-based compensation		-		-		38		-		-		38
Issuance of common stock		1.4		-		4		-		-		4
Common stock dividends, $0.94 per share		-		-		5		(207)		-		(202)
Repurchase of common stock		(0.7)		-		(52)		-		-		(52)
Balances at May 4, 2024		216.1	$	22	$	26	$	2,722	$	312	$	3,082
Balances at January 28, 2023		218.1	$	22	$	21	$	2,430	$	322	$	2,795
Net earnings, three months ended August 3, 2024		-		-		-		291		-		291
Net earnings, three months ended April 29, 2023		-		-		-		244		-		244
Other comprehensive loss:
Foreign currency translation adjustments, net of tax		-		-		-		-		(52)		(52)
Stock-based compensation		-		-		3836		-		-		3836
Issuance of common stock		~~1.5~~-		-		41		-		-		41
Common stock dividends, $0.92 per share		-		-		4		(206)		-		(202)
Common stock dividends, $0.94 per share		-		-		4		(207)		-		(203)
Repurchase of common stock		(1.1)		-		(67)		(1431)		-		(8198)
Balances at August 3, 2024		215.0	$	22	$	-	$	2,775	$	310	$	3,107
Balances at February 3, 2024		215.4	$	22	$	31	$	2,683	$	317	$	3,053
Net earnings, six months ended August 3, 2024		-		-		-		537		-		537
Other comprehensive loss:
Foreign currency translation adjustments, net of tax		-		-		-		-		(7)		(7)
Stock-based compensation		-		-		74		-		-		74
Issuance of common stock		1.4		-		5		-		-		5
Common stock dividends, $1.88 per share		-		-		9		(414)		-		(405)
Repurchase of common stock		(1.8)		-		(119)		(31)		-		(150)
Balances at August 3, 2024		215.0	$	22	$	-	$	2,775	$	310	$	3,107
Balances at April 29, 2023		218.5	$	22	$	-	$	2,454	$	317	$	2,793
Net earnings, three months ended July 29, 2023		-		-		-		274		-		274
Other comprehensive income:
Foreign currency translation adjustments, net of tax		-		-		-		-		5		5
Stock-based compensation		-		-		37		-		-		37
Issuance of common stock		0.3		-		6		-		-		6
Common stock dividends, $0.92 per share		-		-		3		(204)		-		(201)
Repurchase of common stock		(0.9)		-		(46)		(33)		-		(79)
Balances at July 29, 2023		217.9	$	22	$	-	$	2,491	$	322	$	2,835
Balances at January 28, 2023		218.1	$	22	$	21	$	2,430	$	322	$	2,795
Net earnings, six months ended July 29, 2023		-		-		-		518		-		518
Stock-based compensation		-		-		75		-		-		75
Issuance of common stock		1.8		-		10		-		-		10
Common stock dividends, $1.84 per share		-		-		7		(410)		-		(403)
Repurchase of common stock		(2.0)		-		(113)		(47)		-		(160)
Balances at July 29, 2023		217.9	$	22	$	-	$	2,491	$	322	$	2,835

See Notes to Condensed Consolidated Financial Statements.

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Notes to Condensed Consolidated Financial Statements

(unaudited)

1. Basis of Presentation

Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” in these Notes to Condensed Consolidated Financial Statements refers to Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries.

In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments necessary for a fair presentation as prescribed by accounting principles generally accepted in the U.S. (“GAAP”). All adjustments were comprised of normal recurring adjustments, except as noted in these Notes to Condensed Consolidated Financial Statements.

A large proportion of our revenue and earnings is generated in the fiscal fourth quarter, which includes the majority of the holiday shopping season. Due to the seasonal nature of our business, interim results are not necessarily indicative of results for the entire fiscal year. The interim financial statements and the related notes included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024. The first ~~three~~six months of fiscal 2025 and fiscal 2024 each included 1326 weeks.

In preparing the accompanying condensed consolidated financial statements, we evaluated the period from ~~May~~August 43, 2024, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. No such events were identified.

Sale of Subsidiary

In the second quarter of fiscal 2024, we completed the sale of a Mexico subsidiary subsequent to our exit from operations in Mexico and recognized a $21 million gain within Gain on sale of subsidiary, net on our Condensed Consolidated Statements of Earnings for the three and six months ended July 29, 2023.

Recently Issued Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which enhances reportable segment disclosure requirements primarily through expanded disclosures around significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. The amendments should be applied retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of the ASU and expect to include updated segment expense disclosures in our fiscal 2025 Form 10-K.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of specific categories meeting a quantitative threshold within the income tax rate reconciliation, as well as disaggregation of income taxes paid by jurisdiction. This ASU, which can be applied either prospectively or retrospectively, is effective for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of the ASU and expect to include updated income tax disclosures in our fiscal 2026 Form 10-K.

Supply Chain Financing

We have a supply chain financing program with an independent financial institution, whereby some of our suppliers have the opportunity to receive accounts payable settlements early, at a discount, facilitated by the financial institution. Our liability associated with the funded participation in the program, which is primarily included in Accounts payable on our Condensed Consolidated Balance Sheets, was $~~505~~729 million, $426 million and $~~490~~609 million as of ~~May 4~~August 3, 2024, February 3, 2024, and ~~April~~ July 29, 2023, respectively.

Total Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash reported on our Condensed Consolidated Balance Sheets are reconciled to the total shown on our Condensed Consolidated Statements of Cash Flows as follows ($ in millions):

	May 4, 2024		February 3, 2024		April 29, 2023
	August 3, 2024		February 3, 2024		July 29, 2023
Cash and cash equivalents	$	1,~~214~~387	$	1,447	$	1,~~030~~093
Restricted cash included in Other current assets		~~313~~311		346		~~402~~398
Total cash, cash equivalents and restricted cash	$	1,~~527~~698	$	1,793	$	1,~~432~~491

Amounts included in restricted cash are primarily restricted to cover product protection plans provided under our membership offerings and ~~other~~ self-insurance liabilities.

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Reclassification

Certain reclassifications of immaterial amounts previously reported have been made to the accompanying Condensed Consolidated Statements of Cash Flows to maintain consistency and comparability between periods presented.

2. Restructuring

Restructuring charges were as follows ($ in millions):

	~~Three Months Ended~~	Three Months Ended					Six Months Ended
	May 4, 2024			April 29, 2023
		August 3, 2024			July 29, 2023		August 3, 2024		July 29, 2023
Fiscal 2024 Restructuring Initiative	$	16$	(6)	$	-$	-	$	10	$	-
Fiscal 2023 Resource Optimization Initiative		~~(1)~~	(1)		~~(9)~~	(7)		(2)		(16)
Total	$	15$	(7)	$	~~(9)~~$	(7)	$	8	$	(16)

Fiscal 2024 Restructuring Initiative

During the fourth quarter of fiscal 2024, we commenced an enterprise-wide restructuring initiative intended to accomplish the following: (1) align field labor resources with where customers want to shop to optimize the customer experience; (2) redirect corporate resources for better alignment with our strategy; and (3) right-size resources to better align with our revenue outlook for fiscal 2025.

All charges incurred related to this initiative were comprised of employee termination benefits from continuing operations and were presented within Restructuring charges on our Condensed Consolidated Statements of Earnings as follows ($ in millions):

	Three Months Ended		~~Cumulative~~Six ~~Amount~~Months Ended		Cumulative Amount
	May 4, 2024		As of May 4, 2024
	August 3, 2024		August 3, 2024		As of August 3, 2024
Domestic	$	17(7)	$	~~180~~10	$	173
International		(1)		7-		8
Total	$	16(6)	$	~~187~~10	$	181

Restructuring accrual activity related to this initiative was as follows ($ in millions):

	Termination Benefits
	Domestic		International		Total
Balances at February 3, 2024	$	163	$	8	$	171
Charges		17		-1		1718
Cash payments		(966)		-(1)		(967)
Adjustments(1)		-(7)		(1)		(18)
Balances at May 4, 2024	$	171	$	7	$	178
Balances at August 3, 2024	$	107	$	7	$	114

(1)Represents adjustments primarily related to higher-than-expected employee retention from previously planned organizational changes.

We do not expect to incur material future restructuring charges related to this initiative.

Fiscal 2023 Resource Optimization Initiative

During the second quarter of fiscal 2023, we commenced an enterprise-wide initiative to better align our spending with critical strategies and operations, as well as to optimize our cost structure. ~~We do not expect to incur material future restructuring charges related to this initiative.~~ All charges incurred related to this initiative were comprised of employee termination benefits from continuing operations and were presented within Restructuring charges on our Condensed Consolidated Statements of Earnings.

We recorded reductions to employee termination benefits ~~of $1 million and $9 million~~ in ~~the~~all ~~first~~periods ~~quarter~~presented, ofprimarily ~~fiscal~~within ~~2025~~our ~~and~~Domestic ~~fiscal 2024~~segment, ~~respectively, primarily~~ related to higher-than-expected employee retention. Cumulative charges incurred related to this initiative as of ~~May~~August 43, 2024, were $~~126~~ 125 million, comprised of $~~123~~122 million and $3 million ~~of employee termination benefits~~ within our Domestic and International segments, respectively. We do not expect to incur material future restructuring charges related to this initiative, and no material liability remains as of August 3, 2024.

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Restructuring accrual activity related to this initiative was as follows ($ in millions):

	Termination Benefits
	Domestic		International		Total
Balances at January 28, 2023	$	102	$	5	$	107
Cash payments		(9)		(2)		(11)
Adjustments(1)		(8)		(1)		(9)
Balances at April 29, 2023	$	85	$	2	$	87
Balances at February 3, 2024	$	16	$	-	$	16
Cash payments		(2)		-		(2)
Adjustments(1)		(1)		-		(1)
Balances at May 4, 2024	$	13	$	-	$	13

(1)Represents adjustments primarily related to higher-than-expected employee retention from previously planned organizational changes

3. Goodwill and Intangible Assets

Goodwill

Goodwill balances were as follows as of ~~May 4~~August 3, 2024, February 3, 2024, and ~~April~~July 29, 2023 ($ in millions):


	Gross Carrying Amount		Cumulative Impairment
Domestic	$	1,450	$	(67)
International		608		(608)
Total	$	2,058	$	(675)

No impairment charges were recorded during the periods presented.

Indefinite-Lived Intangible Assets

In the second quarter of fiscal 2025, we reclassified our Yardbird tradename from a definite-lived intangible asset to an indefinite-lived intangible asset to better reflect our expectations of the long-term use of the tradename. The carrying value of the tradename was $16 million as of August 3, 2024, and was recorded within Other assets on our Consolidated Balance Sheets.

Definite-Lived Intangible Assets

We have definite-lived intangible assets recorded within Other assets on our Condensed Consolidated Balance Sheets as follows ($ in millions):

	May 4, 2024				February 3, 2024				April 29, 2023				Weighted-Average
	August 3, 2024				February 3, 2024				July 29, 2023
	Gross Carrying ‎Amount		Accumulated ‎Amortization		Gross Carrying ‎Amount		Accumulated ‎Amortization		Gross Carrying ‎Amount		Accumulated ‎Amortization		Weighted-Average Useful Life Remaining ‎as of ~~May~~August 43, 2024 (in years)
Customer relationships	$	360	$	~~278~~280	$	360	$	276	$	360	$	~~249~~264		9.86
Tradenames		~~108~~92		7275		108		69		108		6063		42.72
Developed technology		64		60		64		59		64		5457		3.53
Total	$	~~532~~516	$	~~410~~415	$	532	$	404	$	532	$	~~363~~384		8.1

Amortization expense was as follows ($ in millions):

		Three Months Ended				Six Months Ended
	Statement of Earnings Location	~~May~~August 43, 2024		~~April~~July 29, 2023		August 3, 2024		July 29, 2023
Amortization expense	~~SG&A~~Selling, general and administrative expenses	$	65	$	2021	$	11	$	41

Amortization expense expected to be recognized in future periods is as follows ($ in millions):

	Amortization Expense
Remainder of fiscal 2025	$	159
Fiscal 2026		2118
Fiscal 2027		1816
Fiscal 2028		1210
Fiscal 2029		118
Fiscal 2030		97
Thereafter		3633

4. Fair Value Measurements

Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).

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Recurring Fair Value Measurements

Financial assets and liabilities accounted for at fair value were as follows ($ in millions):

Fair Value at

Fair Value as of

Balance Sheet Location(1)

Fair Value Hierarchy

~~May~~August 43, 2024

February 3, 2024

~~April~~July 29, 2023

Assets

Money market funds(2)

Cash and cash equivalents

Level 1

~~234~~212

330

~~133~~104

Time deposits(3)

Cash and cash equivalents

Level 2

~~110~~136

~~115~~117

Money market funds(2)

Other current assets

Level 1

~~184~~147

182

~~200~~167

Time deposits(3)

Other current assets

Level 2

4060

Marketable securities that fund deferred compensation(4)

Other assets

Level 1

4938

4647

Liabilities

Interest rate swap derivative instruments(5)

Long-term liabilities

Level 2

272

1120

(1)Balance sheet location is determined by the length to maturity at date of purchase and whether the assets are restricted for particular use.

(2)Valued at quoted market prices in active markets at period end.

(3)Valued at face value plus accrued interest at period end, which approximates fair value.

(4)Valued using the performance of mutual funds that trade with sufficient frequency and volume to obtain pricing information on an ongoing basis.

(5)Valued using readily observable market inputs. These instruments are custom, over-the-counter contracts with various bank counterparties that are not traded on an active market. See Note 5, Derivative Instruments, for additional information.

Fair Value of Financial Instruments

The fair values of cash, certain restricted cash, receivables, accounts payable and other payables approximated their carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Fair values for other investments held at cost are not readily available, but we estimate that the carrying values for these investments approximate their fair values.

Long-term debt is presented at carrying value on our Condensed Consolidated Balance Sheets. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. Long-term debt balances were as follows ($ in millions):

May 4, 2024

February 3, 2024

April 29, 2023

August 3, 2024

February 3, 2024

July 29, 2023

Fair Value

~~Fair Value~~

Carrying Value

Fair Value

~~Carrying Value~~

Carrying Value

Fair Value

~~Fair Value~~

Carrying Value

~~Carrying Value~~

~~Fair Value~~

~~Carrying Value~~

Long-term debt(1)

1,058

~~994~~

1,148

1,022

~~1,123~~

1,139

991

~~1,022~~

1,130

~~1,139~~

~~1,023~~

~~1,139~~

(1)Excludes debt discounts, issuance costs and finance lease obligations.

5. Derivative Instruments

We manage our economic and transaction exposure to certain risks by using foreign exchange forward contracts to hedge against the effect of Canadian dollar exchange rate fluctuations on a portion of our net investment in our Canadian operations and by using interest rate swaps to mitigate interest rate risk on our $500 million of principal amount of notes due October 1, 2028. In addition, we use foreign currency forward contracts not designated as hedging instruments to manage the impact of fluctuations in foreign currency exchange rates relative to recognized receivable and payable balances denominated in non-functional currencies.

Our derivative instruments designated as net investment hedges and fair value hedges are recorded on our Condensed Consolidated Balance Sheets at fair value. ~~When~~The ~~significant, the~~ gross fair values of our outstanding derivative instruments and corresponding fair value classifications are included in Note 4, Fair Value Measurements.

Notional amounts of our derivative instruments were as follows ($ in millions):

Contract Type	~~May~~August 43, 2024		February 3, 2024		~~April~~July 29, 2023
Derivatives designated as net investment hedges	$	~~191~~103	$	100	$	102
Derivatives designated as fair value hedges (interest rate swaps)		500		500		500
No hedge designation (foreign exchange contracts)		5759		66		5750
Total	$	~~748~~662	$	666	$	~~659~~652

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Effects of our derivative instruments on our Condensed Consolidated Statements of Earnings were as follows ($ in millions):

		Gain (Loss) Recognized
		Three Months Ended				Six Months Ended
	Statement of Earnings Location	~~May~~August 43, 2024		~~April~~July 29, 2023		August 3, 2024		July 29, 2023
Interest rate swaps	Interest expense	$	~~(15)~~24	$	(410)	$	9	$	(14)
Adjustments to carrying value of long-term debt	Interest expense		15(24)		410		(9)		14
Total		$	-	$	-	$	-	$	-

6. Debt

Short-Term Debt

U.S. Revolving Credit Facility

We have a $1.25 billion five-year senior unsecured revolving credit facility agreement (the “Five-Year Facility Agreement”) with a syndicate of banks that expires in April 2028. There were no borrowings outstanding under the Five-Year Facility Agreement as of ~~May~~August 43, 2024, February 3, 2024, or ~~April~~July 29, 2023.

Long-Term Debt

Long-term debt consisted of the following ($ in millions):

	May 4, 2024		February 3, 2024		April 29, 2023
	August 3, 2024		February 3, 2024		July 29, 2023
Notes, 4.45%, due October 1, 2028	$	500	$	500	$	500
Notes, 1.95%, due October 1, 2030		650		650		650
Interest rate swap valuation adjustments		(272)		(11)		(1120)
Subtotal		1,~~123~~148		1,139		1,~~139~~130
Debt discounts and issuance costs		(87)		(8)		(9)
Finance lease obligations		3429		34		4039
Total long-term debt		1,~~149~~170		1,165		1,~~170~~160
Less current portion		1513		13		15
Total long-term debt, less current portion	$	1,~~134~~157	$	1,152	$	1,~~155~~145

Fair Value and Future Maturities

See Note 4, Fair Value Measurements, for the fair value of long-term debt. Other than the $500 million of principal amount of notes due October 1, 2028, we do not have any future maturities of long-term debt within the next five fiscal years.

7. Revenue

We generate substantially all of our revenue from contracts with customers from the sale of products and services. Contract balances primarily consist of receivables and liabilities related to unfulfilled membership benefits and services not yet completed, product merchandise not yet delivered to customers, deferred revenue from our private label and co-branded credit card arrangement and unredeemed gift cards. Contract balances were as follows ($ in millions):

	May 4, 2024		February 3, 2024		April 29, 2023
	August 3, 2024		February 3, 2024		July 29, 2023
Receivables, net(1)	$	~~453~~474	$	512	$	~~523~~485
Short-term contract liabilities included in:
Unredeemed gift card liabilities		~~242~~243		253		~~256~~250
Deferred revenue		~~923~~940		1,000		~~1,015~~996
Accrued liabilities		5764		53		6864
Long-term contract liabilities included in:
Long-term liabilities		~~239~~233		245		~~260~~254

(1)Receivables are recorded net of allowances for expected credit losses of $1716 million, $23 million and $18 million as of ~~May~~August 43, 2024, February 3, 2024, and ~~April~~July 29, 2023, respectively.

During the first ~~three~~six months of fiscal 2025 and fiscal 2024, $~~642~~893 million and $~~747~~1,026 million of revenue was recognized, respectively, that was included in the contract liabilities at the beginning of the respective periods.

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Estimated revenue from our contract liability balances expected to be recognized in future periods if the performance of the contract is expected to have an initial duration of more than one year is as follows ($ in millions):

Fiscal Year		Amount
Remainder of fiscal 2025	$	2617
Fiscal 2026		3233
Fiscal 2027		2627
Fiscal 2028		25
Fiscal 2029		25
Fiscal 2030		25
Thereafter		112

See Note 11, Segments, for information on our revenue by reportable segment and product category.

8. Earnings per Share

We compute our basic earnings per share based on the weighted-average number of common shares outstanding and our diluted earnings per share based on the weighted-average number of common shares outstanding adjusted by the number of additional shares that would have been outstanding had potentially dilutive common shares been issued.

Reconciliations of the numerators and denominators of basic and diluted earnings per share were as follows ($ and shares in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Numerator
Net earnings	$	~~246~~291	$	~~244~~274	$	537	$	518
Denominator
Weighted-average common shares outstanding		216.20		218.96		216.1		218.7
Dilutive effect of stock compensation plan awards		1.01		1.0.4		1.1		0.8
Weighted-average common shares outstanding, assuming dilution		217.21		219.90		217.2		219.5
Potential shares which were anti-dilutive and excluded from weighted-average share computations		~~0.6~~-		1.01		-		1.3
Basic earnings per share	$	1.1435	$	1.1125	$	2.49	$	2.37
Diluted earnings per share	$	1.1334	$	1.1125	$	2.47	$	2.36

9. Repurchase of Common Stock

On February 28, 2022, our Board of Directors approved a $5.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under this authorization.

Information regarding share repurchases was as follows ($ and shares in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Total cost of shares repurchased	$	5298	$	8169	$	150	$	150
Average price per share	$	7782.8157	$	76.1588	$	80.86	$	76.48
Total number of shares repurchased		01.71		10.19		1.8		2.0

As of ~~May~~August 43, 2024, $3.76 billion of the $5.0 billion share repurchase authorization was available. Between the end of the ~~first~~second quarter of fiscal 2025 on ~~May~~August 43, 2024, and ~~June~~September 54, 2024, we repurchased an incremental 0.4 million shares of our common stock at a cost of $3439 million. We currently expect total share repurchases of approximately $~~350~~500 million in fiscal 2025.

10. Contingencies

We are involved in a number of legal proceedings. Where appropriate, we have made accruals with respect to these matters, which are reflected on our Condensed Consolidated Financial Statements. However, there are cases where liability is not probable or the amount cannot be reasonably estimated and, therefore, accruals have not been made. We provide disclosure of matters where we believe it is reasonably possible the impact may be material to our Condensed Consolidated Financial Statements.

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11. Segments

Reportable segment and product category revenue information was as follows ($ in millions):

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Revenue by reportable segment
Domestic	$	8,~~203~~623	$	8,~~801~~890	$	16,826	$	17,691
International		~~644~~665		~~666~~693		1,309		1,359
Total revenue	$	89,~~847~~288	$	9,~~467~~583	$	18,135	$	19,050
Revenue by product category
Domestic:
Computing and Mobile Phones	$	3,~~588~~792	$	3,~~688~~674	$	7,380	$	7,362
Consumer Electronics		2,~~364~~478		2,~~592~~658		4,842		5,250
Appliances		1,~~090~~177		1,~~339~~384		2,267		2,723
Entertainment		~~520~~498		~~591~~544		1,018		1,135
Services		~~578~~590		~~537~~550		1,168		1,087
Other		6388		5480		151		134
Total Domestic revenue	$	8,~~203~~623	$	8,~~801~~890	$	16,826	$	17,691
International:
Computing and Mobile Phones	$	~~318~~308	$	~~316~~309	$	626	$	625
Consumer Electronics		~~173~~186		~~184~~194		359		378
Appliances		6086		5992		146		151
Entertainment		4639		6050		85		110
Services		3938		3638		77		74
Other		8		1110		16		21
Total International revenue	$	~~644~~665	$	~~666~~693	$	1,309	$	1,359

Operating income by reportable segment and the reconciliation to consolidated earnings before income tax expense and equity in income ~~(loss)~~ of affiliates was as follows ($ in millions):

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Domestic	$	~~303~~367	$	~~290~~329	$	670	$	619
International		916		2119		25		40
Total operating income		~~312~~383		~~311~~348		695		659
Other income (expense):
Investment income and other		25		21
Gain on sale of subsidiary, net		-		21		-		21
Interest expense		(12)		(12)
Investment income and other		21		12		46		33
Earnings before income tax expense and equity in income (loss) of affiliates	$	325	$	320
Interest expense		(13)		(12)		(25)		(24)
Earnings before income tax expense and equity in income of affiliates	$	391	$	369	$	716	$	689

Assets by reportable segment were as follows ($ in millions):

May 4, 2024

February 3, 2024

April 29, 2023

August 3, 2024

February 3, 2024

July 29, 2023

Domestic

1314,~~483~~471

13,660

1314,~~561~~028

International

1,~~269~~153

1,307

1,~~127~~290

Total assets

1415,~~752~~624

14,967

1415,~~688~~318

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Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations

Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” refers to Best Buy Co., Inc. and its consolidated subsidiaries. Any references to our website addresses do not constitute incorporation by reference of the information contained on the websites.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. Unless otherwise noted, transactions and other factors significantly impacting our financial condition, results of operations and liquidity are discussed in order of magnitude. Our MD&A should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended February 3, 2024 (including the information presented therein under Risk Factors), as well as our other reports on Forms 10-Q and 8-K and other publicly available information. All amounts herein are unaudited.

Overview

We are driven by our purpose to enrich lives through technology and our vision to personalize and humanize technology solutions for every stage of life. We accomplish this by leveraging our combination of technology and a human touch to meet our customers’ everyday needs, whether they come to us online, visit our stores or invite us into their homes.

We have two reportable segments: Domestic and International. The Domestic segment is comprised of our operations in all states, districts and territories of the U.S. and our Best Buy Health business. The International segment is comprised of all our operations in Canada.

Our fiscal year ends on the Saturday nearest the end of January. Our business, like that of many retailers, is seasonal. A large proportion of our revenue and earnings is generated in the fiscal fourth quarter, which includes the majority of the holiday shopping season.

Comparable Sales

Throughout this MD&A, we refer to comparable sales. Comparable sales is a metric used by management to evaluate the performance of our existing stores, websites and call centers by measuring the change in net sales for a particular period over the comparable prior period of equivalent length. Comparable sales includes revenue from stores, websites and call centers operating for at least 14 full months. Revenue from online sales is included in comparable sales and represents sales initiated on a website or app, regardless of whether customers choose to pick up product in store, curbside, at an alternative pick-up location or take delivery direct to their homes. Revenue from acquisitions is included in comparable sales beginning with the first full quarter following the first anniversary of the date of the acquisition. Comparable sales also includes credit card revenue, gift card breakage, commercial sales and sales of merchandise to wholesalers and dealers, as applicable. Revenue from stores closed more than 14 days, including but not limited to relocated, remodeled, expanded and downsized stores, or stores impacted by natural disasters, is excluded from comparable sales until at least 14 full months after reopening. Comparable sales excludes the impact of certain periodic warranty-related profit-share revenue, the effect of fluctuations in foreign currency exchange rates (applicable to our International segment only) and the impact of the 53^rd week (applicable in 53-week fiscal years only). Comparable sales is based on our fiscal calendar and is not adjusted to align calendar weeks. All periods presented apply this methodology consistently.

We believe comparable sales is a meaningful supplemental metric for investors to evaluate revenue performance resulting from growth in existing stores, websites and call centers versus the portion resulting from opening new stores or closing existing stores. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods.

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Non-GAAP Financial Measures

This MD&A includes financial information prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”), as well as certain adjusted or non-GAAP financial measures, such as non-GAAP operating income, non-GAAP effective tax rate and non-GAAP diluted earnings per share (“EPS”). We believe that non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, provide additional useful information for evaluating current period performance and assessing future performance. For these reasons, internal management reporting, including budgets, forecasts and financial targets used for short-term incentives are based on non-GAAP financial measures. Generally, our non-GAAP financial measures include adjustments for items such as restructuring charges, goodwill and intangible asset impairments, price-fixing settlements, gains and losses on sales of subsidiaries and certain investments, intangible asset amortization, certain acquisition-related costs and the tax effect of all such items. In addition, certain other items may be excluded from non-GAAP financial measures when we believe doing so provides greater clarity to management and our investors. We provide reconciliations of the most comparable financial measures presented in accordance with GAAP to presented non-GAAP financial measures that enable investors to understand the adjustments made in arriving at the non-GAAP financial measures and to evaluate performance using the same metrics as management. These non-GAAP financial measures should be considered in addition to, and not superior to or as a substitute for, GAAP financial measures. We strongly encourage investors and shareholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. Non-GAAP financial measures may be calculated differently from similarly titled measures used by other companies, thereby limiting their usefulness for comparative purposes.

In our discussions of the operating results of our consolidated business and our International segment, we sometimes refer to the impact of changes in foreign currency exchange rates or the impact of foreign currency exchange rate fluctuations, which are references to the differences between the foreign currency exchange rates we use to convert the International segment’s operating results from local currencies into U.S. dollars for reporting purposes. We also may use the term “constant currency,” which represents results adjusted to exclude foreign currency impacts. We calculate those impacts as the difference between the current period results translated using the current period currency exchange rates and using the comparable prior period currency exchange rates. We believe the disclosure of revenue changes in constant currency provides useful supplementary information to investors in light of significant fluctuations in currency rates.

Refer to the Non-GAAP Financial Measures section below for detailed reconciliations of items impacting non-GAAP operating income, non-GAAP effective tax rate and non-GAAP diluted EPS in the presented periods.

Business Strategy Update

In the ~~first~~second quarter of fiscal 2025, we continued to manage our profitability through strong execution, while at the same time preparing for future growth. We made progress on our fiscal 2025 priorities, grew our paid membership base, ~~implemented~~continued to implement previously announced restructuring actions and drove improvements in our prioritized customer experiences. ~~While~~We ~~macroeconomic~~delivered ~~factors~~sales ~~continued~~growth toin ~~create~~our aDomestic ~~challenging~~tablet ~~sales~~and ~~environment~~computing ~~during~~categories ~~the~~as ~~quarter,~~our wemarket ~~will~~position, ~~continue~~expert tosales ~~navigate~~associates ~~this~~and ~~fluctuating~~compelling ~~environment~~merchandising ~~and~~allowed ~~its~~us ~~impact~~to capitalize on ~~customer~~ demand ~~while~~driven ~~remaining~~by ~~focused~~our ~~and~~customers’ ~~energized~~desire ~~about~~to ~~our~~replace ~~purpose~~or toupgrade ~~enrich~~their ~~lives~~products ~~through~~combined ~~technology~~with new innovation.

WeOur ~~expect~~enterprise comparable sales declined 2.3% in the second quarter of fiscal 2025, compared to be a ~~year~~comparable ofsales ~~increasing~~decline ~~industry~~of ~~stabilization~~6.1% asin the ~~pace~~first quarter of ~~innovation~~fiscal ~~increases~~2025. ~~and~~We ~~consumers~~believe ~~begin~~the tosecond ~~upgrade~~quarter ~~and~~sequential ~~replace~~improvement ~~technology~~in ~~products~~comparable ~~bought~~sales ~~early~~supports our belief that this will be a year of further stabilization in the ~~pandemic~~consumer electronics industry. To ensure we are in the best position possible to benefit from these industry developments, we are focused on the following four priorities: (1) invigorate and progress targeted customer experiences; (2) drive operational effectiveness and efficiency; (3) continue our disciplined approach to capital allocation; and (4) explore, pilot and drive incremental revenue streams.

In the ~~first~~second quarter of fiscal 2025, we ~~focused~~completed onthe ~~providing~~roll-out ~~increasingly~~of personalized, ~~highly~~ relevant and motivational content to our App users to drive higher engagement. Each of our App users’ home screens ~~will~~now ~~eventually~~ look different based on their personal preferences and a number of factors like current location, shopping history, membership status and what we know they care about the most based on their activity. ~~We are also driving speed improvements on the product pages and in checkout in the mobile experience to drive customer experience and sales performance.~~

In our stores, we ~~plan~~are tomaking ~~make~~ enhancements to every store in the chain in some fashion throughout the second and third quarters, improving both our merchandising and ease of shopping for customers. This includes working with many of our vendors to implement new and enhanced in-store experiences across the store. To continue to elevate the expert service we provide customers, we ~~are~~have ~~adding~~added fully dedicated labor expertise to our in-store computing, and have begun the process of doing so in our home theater and major appliances departments in hundreds of stores. These changes are in addition to the actions taken throughout the past year to streamline our leadership model, allowing us to invest in more customer-facing sales associate hours in our stores.

While we elevate our customer experiences, we are simultaneously executing on our longstanding commitment to drive operational effectiveness and efficiencies and identify cost reductions, as this is paramount to help offset inflationary pressures in our business and fund investment capacity. For example, in fiscal 2025 we are focused on driving further efficiencies across our forward and reverse supply chain, our Geek Squad repair operations, and our customer care experience. We will continue to lean heavily on analytics and technology to achieve these efficiencies.

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Our third key priority for the year is to continue our disciplined approach to capital allocation. This ~~will~~includes ~~include~~ striking the appropriate balance of prioritizing areas that best position us for the future, while prudently dealing with the near-term uncertainty in the consumer electronics industry.

Our fourth key priority for fiscal 2025 is longer-term in focus. We will continue to explore opportunities that leverage our scale and capabilities to drive incremental profitable revenue streams over time.

We ~~believe we~~ are ~~starting to see~~ the ~~pace of technology innovation increase as computing devices powered by artificial intelligence are expected to launch this summer. We are the~~ largest consumer electronics specialty retailer with what we believe to be a unique range of product assortment and expert services to help humanize tech, especially new innovation, for every stage of our customers’ lives. We intend to strengthen our position in key categories like computing, home theater and major appliances through our differentiated experiences, pointed marketing spend and competitive pricing. ~~We believe we are putting ourselves in the best position for fiscal 2025 and beyond.~~

Results of Operations

Consolidated Results

Selected consolidated financial data was as follows ($ in millions, except per share amounts):

	Three Months Ended						Six Months Ended
	May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Revenue	$	89,~~847~~288		$	9,~~467~~583		$	18,135		$	19,050
Revenue % change		(63.51)	%		(117.12)	%		(4.8)	%		(9.2)	%
Comparable sales % change		(62.13)	%		(106.12)	%		(4.2)	%		(8.2)	%
Gross profit	$	2,~~064~~186		$	2,~~150~~220		$	4,250		$	4,370
Gross profit as a % of revenue(1)		23.35	%		2223.72	%		23.4	%		22.9	%
SG&A	$	1,737		$	1,848
Selling, general and administrative expense ("SG&A")	$	1,810		$	1,879		$	3,547		$	3,727
SG&A as a % of revenue(1)		19.65	%		19.56	%		19.6	%		19.6	%
Restructuring charges	$	15(7)		$	(97)		$	8		$	(16)
Operating income	$	~~312~~383		$	~~311~~348		$	695		$	659
Operating income as a % of revenue		34.51	%		3.36	%		3.8	%		3.5	%
Net earnings	$	~~246~~291		$	~~244~~274		$	537		$	518
Diluted earnings per share	$	1.1334		$	1.1125		$	2.47		$	2.36

(1)Because retailers vary in how they record costs of operating their supply chain between cost of sales and SG&A, our gross profit rate and SG&A rate may not be comparable to other retailers’ corresponding rates. For additional information regarding costs classified in cost of sales and SG&A, refer to Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024.

In the ~~first~~second quarter and first six months of fiscal 2025, we generated $89.83 billion and $18.1 billion in revenue, respectively, and our comparable sales ~~declined~~sequentially 6improved from the first quarter of fiscal 2025 to a decline of 2.13% and a decline of 4.2%, respectively, as we continued to operate in a challenged consumer electronics industry. ~~that~~Despite iscomparable ~~challenged~~sales bydeclines ~~various~~in ~~macroeconomic~~the ~~pressures~~second quarter of fiscal 2025 in categories such as appliances, ~~including~~home ~~high~~theater ~~inflation~~and gaming, ~~increased~~we ~~spending~~delivered ~~outside~~comparable ~~the~~sales ~~home~~growth in ~~areas~~our ~~such~~tablet asand ~~travel~~computing ~~and~~categories, ~~entertainment~~driven ~~and~~by ~~lower~~customers’ ~~levels~~desire ofto replace or upgrade their products combined with new product innovation.

Revenue, gross profit rate, SG&A and operating income rate changes in the ~~first~~second quarter and first six months of fiscal 2025 were primarily driven by our Domestic segment. For further discussion of our Domestic and International segments, see Segment Performance Summary, below.

Store Summary

Stores open by reportable segment were as follows:

	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023
Best Buy		~~891~~890		~~908~~907
Outlet Centers		2326		20
Pacific Sales		20		20
Yardbird		23		1822
Total Domestic stores		~~957~~959		~~966~~969
Canada Best Buy stores		~~128~~129		~~127~~128
Canada Best Buy Mobile stand-alone stores		32		32
Total International stores		~~160~~161		~~159~~160
Total stores		1,~~117~~120		1,~~125~~129

We continuously monitor store performance as part of a market-driven, omnichannel strategy. As we approach the expiration of leases, we evaluate various options for each location, including whether a store should remain open. We currently expect to close a total of approximately 10 to 15 Domestic Best Buy stores in fiscal 2025.

‎

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Income Tax Expense

Income tax expense increased in the ~~first~~second quarter of fiscal 2025, primarily due to ~~reduced~~an ~~benefits~~increase ~~from~~in ~~the resolution of~~ pre-tax ~~matters and stock-based compensation~~earnings. Our effective tax rate (“ETR”) ~~increased~~decreased to 2425.78% in the ~~first~~second quarter of fiscal 2025 compared to 2326.31% in the ~~first~~second quarter of fiscal 2024, primarily due to ~~reduced~~increased tax benefits from ~~the resolution of tax matters and stock-based compensation, partially offset by benefits from~~ green energy incentives.

Income tax expense increased in the first six months of fiscal 2025, primarily due to an increase in pre-tax earnings. Our ETR increased to 25.3% in the first six months of fiscal 2025 compared to 24.8% in the first six months of fiscal 2024, primarily due to reduced tax benefits from the resolution of tax matters and stock-based compensation, partially offset by increased tax benefits from green energy incentives.

Our tax provision for interim periods is determined using an estimate of our annual ETR, adjusted for discrete items, if any, that are taken into account in the relevant period. We update our estimate of the annual ETR each quarter and we make a cumulative adjustment if our estimated tax rate changes. Our quarterly tax provision and our quarterly estimate of our annual ETR are subject to variation due to several factors, including our ability to accurately forecast our pre-tax and taxable income and loss by jurisdiction, tax audit developments, recognition of excess tax benefits or deficiencies related to stock-based compensation, foreign currency gains (losses), changes in laws or regulations, and expenses or losses for which tax benefits are not recognized. Our ETR can be more or less volatile based on the amount of pre-tax earnings. For example, the impact of discrete items and non-deductible losses on our ETR is greater when our pre-tax earnings are lower.

Segment Performance Summary

Domestic Segment

Selected financial data for the Domestic segment was as follows ($ in millions):

	Three Months Ended						Six Months Ended
	May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Revenue	$	8,~~203~~623		$	8,~~801~~890		$	16,826		$	17,691
Revenue % change		(63.80)	%		(117.01)	%		(4.9)	%		(9.1)	%
Comparable sales % change(1)		(62.3)	%		(106.43)	%		(4.3)	%		(8.4)	%
Gross profit	$	12,~~917~~027		$	12,~~992~~052		$	3,944		$	4,044
Gross profit as a % of revenue		23.45	%		2223.61	%		23.4	%		22.9	%
SG&A	$	1,~~598~~668		$	1,~~710~~730		$	3,266		$	3,440
SG&A as a % of revenue		19.53	%		19.45	%		19.4	%		19.4	%
Restructuring charges	$	16(8)		$	(87)		$	8		$	(15)
Operating income	$	~~303~~367		$	~~290~~329		$	670		$	619
Operating income as a % of revenue		34.73	%		3.37	%		4.0	%		3.5	%
Selected Online Revenue Data
Total online revenue	$	2,~~525~~718		$	2,~~688~~763		$	5,243		$	5,451
Online revenue as a % of total segment revenue		3031.85	%		3031.51	%		31.2	%		30.8	%
Comparable online sales % change(1)		(6.1.6)	%		(127.1)	%		(3.8)	%		(9.7)	%

(1)Comparable online sales are included in the comparable sales calculation.

Domestic revenue decreased in the ~~first~~second quarter of fiscal 2025, primarily driven by comparable sales declines in the appliances, home theater, and gaming categories, partially offset by comparable sales growth in the tablets, computing and ~~mobile~~services ~~phones~~categories. ~~These~~In ~~drivers~~the ~~were~~first six months of fiscal 2025, Domestic revenue decreased, primarily driven by comparable sales declines in the appliances, home theater and gaming categories, partially offset by comparable sales growth in the services, tablets and ~~laptops~~computing categories. Online revenue of $2.57 billion ~~decreased~~and 6$5.1%2 billion onin athe ~~comparable~~second ~~basis~~quarter inand ~~the~~ first ~~quarter~~six months of fiscal 2025. ~~Domestic~~decreased ~~segment~~1.6% ~~revenue~~and ~~declines~~3.8%, ~~were~~respectively, ~~also~~on ~~due~~a tocomparable ~~the factors described within the Consolidated Results section, above~~basis.

Domestic segment revenue mix percentages and comparable sales percentage changes by revenue category were as follows:

		Revenue Mix						Comparable Sales
		Three Months Ended						Three Months Ended
	May 4, 2024			April 29, 2023			May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Computing and Mobile Phones		44	%		4241	%		(23.2)9	%		(136.34)	%
Consumer Electronics		29	%		2930	%		(86.32)	%		(95.87)	%
Appliances		13	%		1516	%		(1814.59)	%		(1516.51)	%
Entertainment		6	%		76	%		(117.34)	%		39.80	%
Services		7	%		6	%		98.05	%		127.06	%
Other		1	%		1	%		1814.24	%		~~(12~~2.1)4	%
Total		100	%		100	%		(62.3)	%		(106.43)	%

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Notable comparable sales changes by revenue category were as follows:

Computing and Mobile Phones: The 23.29% comparable sales ~~decline~~growth was driven primarily by ~~declines~~tablets ~~in mobile phones~~ and ~~wearables~~computing, partially offset by a comparable sales ~~growth~~decline in ~~laptops~~mobile phones.

Consumer Electronics: The 86.32% comparable sales decline was driven primarily by home theater.

Appliances: The 1814.59% comparable sales decline was driven primarily by large appliances.

Entertainment: The 117.34% comparable sales decline was driven primarily by gaming.

Services: The 98.05% comparable sales growth was driven primarily by delivery and installation services.

Domestic gross profit rate increased in the ~~first~~second quarter and first six months of fiscal 2025, primarily due to improved financial performance from our services category, including our membership offerings, which was partially offset by lower product margin rates and lower profit-sharing revenue from our private label and co-branded credit card arrangement.

Domestic SG&A decreased in the ~~first~~second quarter of fiscal 2025, primarily due to: ~~(1)~~ lower employee compensation expense, ~~which was primarily store payroll; (2) reduced vehicle rental costs;~~ and ~~(3)~~ lower expenses across multiple other areas, ~~such~~including asreduced ~~advertising~~vehicle rental costs and credit card processing fees. These decreases were partially offset by higher ~~technology~~advertising expense.

Domestic ~~restructuring~~SG&A ~~charges~~decreased in the first ~~quarter~~six months of fiscal 2025, ~~were~~ primarily ~~related~~due to lower employee ~~termination~~compensation ~~benefits~~expense, ~~associated~~which ~~with~~was anprimarily ~~enterprise-wide~~store ~~restructuring~~payroll, ~~initiative~~and ~~that~~lower ~~commenced~~expenses inacross ~~the~~multiple ~~fourth~~other ~~quarter of fiscal 2024. Refer to Note 2~~areas, ~~Restructuring,~~including ofreduced ~~the~~vehicle ~~Notes~~rental tocosts. ~~Condensed~~These ~~Consolidated~~decreases ~~Financial~~were ~~Statements,~~partially ~~included~~offset inby ~~this~~higher ~~Quarterly~~advertising ~~Report~~and ontechnology ~~Form 10-Q for additional information~~expense.

Domestic ~~operating~~restructuring ~~income~~charges ~~rate increased~~ in the ~~first~~second quarter and first six months of fiscal 2025, were primarily ~~due~~related to ~~favorability~~employee intermination ~~gross~~benefits ~~profit~~and ~~rate,~~subsequent ~~partially~~adjustments ~~offset~~from by higher-than-expected ~~restructuring~~employee ~~charges~~retention ~~and~~associated with an ~~unfavorable~~enterprise-wide ~~SG&A~~restructuring ~~rate~~initiative that ~~was~~commenced ~~driven~~in bythe ~~decreased~~fourth ~~leverage~~quarter ~~from~~of ~~lower~~fiscal ~~sales~~2024. ~~volume~~Refer to Note 2, Restructuring, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on ~~our~~Form ~~fixed~~10-Q ~~expenses.~~for additional information.

Domestic operating income rate increased in the second quarter and first six months of fiscal 2025, primarily due to favorability in the gross profit rate.

International Segment

Selected financial data for the International segment was as follows ($ in millions):

	Three Months Ended						Six Months Ended
	May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Revenue	$	~~644~~665		$	~~666~~693		$	1,309		$	1,359
Revenue % change		(34.30)	%		(118.68)	%		(3.7)	%		(10.2)	%
Comparable sales % change		(31.38)	%		(5.54)	%		(2.6)	%		(5.5)	%
Gross profit	$	~~147~~159		$	~~158~~168		$	306		$	326
Gross profit as a % of revenue		2223.89	%		2324.72	%		23.4	%		24.0	%
SG&A	$	~~139~~142		$	~~138~~149		$	281		$	287
SG&A as a % of revenue		21.64	%		2021.75	%		21.5	%		21.1	%
Operating income	$	916		$	2119		$	25		$	40
Operating income as a % of revenue		12.4	%		3.2.7	%		1.9	%		2.9	%

International revenue decreased in the ~~first~~second quarter of fiscal 2025, primarily driven by athe negative impact of foreign exchange rates and comparable sales ~~decline~~declines in gaming and computing, partially offset by comparable sales growth in mobile phones.

International revenue decreased in the first six months of fiscal 2025, primarily driven by comparable sales declines in gaming and computing, as well as the negative impact of foreign exchange rates. These drivers were partially offset by comparable sales growth in mobile phones.

International segment revenue mix percentages and comparable sales percentage changes by revenue category were as follows:

	Revenue Mix						Comparable Sales
	Three Months Ended						Three Months Ended
	May 4, 2024			April 29, 2023			May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Computing and Mobile Phones		5046	%		4745	%		01.7	%		(32.64)	%
Consumer Electronics		2728	%		28	%		(62.61)	%		(910.14)	%
Appliances		913	%		913	%		2(3.09)	%		(116.71)	%
Entertainment		76	%		97	%		(2220.98)	%		122.05	%
Services		6	%		5	%		5.09	%		~~(11~~4.2)6	%
Other		1	%		2	%		(1320.41)	%		(1938.01)	%
Total		100	%		100	%		(31.38)	%		(5.54)	%

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Notable comparable sales changes by revenue category were as follows:

Computing and Mobile Phones: The 01.7% comparable sales growth was driven primarily by mobile phones, partially offset by a comparable sales decline in computing.

Consumer Electronics: The 62.61% comparable sales decline was driven primarily by ~~headphones and portable speakers, and~~ home ~~theater~~automation.

Appliances: The 23.09% comparable sales ~~growth~~decline was driven primarily by ~~small~~large appliances.

Entertainment: The 2220.98% comparable sales decline was driven primarily by gaming, partially offset by comparable sales growth in virtual reality.

Services: The 5.09% comparable sales growth was driven primarily by ~~warranty-related~~growth ~~services~~in our membership programs.

International gross profit rate decreased in the ~~first~~second quarter and first six months of fiscal 2025, primarily driven by lower product margin rates. and higher supply chain costs, which were partially offset by growth in the higher margin services category.

International SG&A decreased in the ~~first~~second quarter of fiscal 2025, primarily driven by the favorable impact of foreign exchange rates and lower advertising expense, which was ~~relatively~~partially ~~flat~~offset toby ~~last~~expenses ~~year~~associated with new Best Buy Express locations as a result of our previously announced collaboration with Bell Canada.

International ~~operating~~SG&A ~~income rate~~ decreased in the first ~~quarter~~six months of fiscal 2025, primarily ~~due~~driven toby anthe ~~unfavorable~~favorable ~~gross~~impact ~~profit~~of ~~rate~~foreign ~~and~~exchange ~~decreased~~rates, ~~leverage~~lower ~~from~~advertising expense and lower ~~sales~~employee ~~volume~~compensation onexpense, ~~our~~which ~~fixed~~was primarily incentive compensation. These drivers were partially offset by expenses, ~~which~~associated ~~resulted~~with innew anBest ~~unfavorable~~Buy ~~SG&A~~Express ~~rate~~locations and higher technology expense.

International operating income rate decreased in the second quarter of fiscal 2025, primarily due to an unfavorable gross profit rate.

International operating income rate decreased in the first six months of fiscal 2025, primarily due to an unfavorable gross profit rate and decreased leverage from lower sales volume on our fixed expenses, which resulted in an unfavorable SG&A rate.

Consolidated Non-GAAP Financial Measures

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

	Three Months Ended						Six Months Ended
	May 4, 2024			April 29, 2023
	August 3, 2024			July 29, 2023			August 3, 2024			July 29, 2023
Operating income	$	~~312~~383		$	~~311~~348		$	695		$	659
% of revenue		34.51	%		3.36	%		3.8	%		3.5	%
Intangible asset amortization(1)		65			2021			11			41
Restructuring charges(2)		15(7)			(97)			8			(16)
Non-GAAP operating income	$	~~333~~381		$	~~322~~362		$	714		$	684
% of revenue		34.81	%		3.48	%		3.9	%		3.6	%
Effective tax rate		2425.78	%		2326.31	%		25.3	%		24.8	%
Intangible asset amortization(1)		-	%		(0.14)	%		-	%		0.4	%
Non-GAAP effective tax rate		24.7	%		23.4	%
Restructuring charges(2)		-	%		0.4	%		-	%		(0.1)	%
Diluted EPS	$	1.13		$	1.11
Loss on investments		-	%		0.5	%		-	%		-	%
Intangible asset amortization(1)		0.03			0.09
Non-GAAP effective tax rate		25.8	%		26.6	%		25.3	%		25.1	%
Restructuring charges(2)		0.07			(0.04)
Diluted EPS	$	1.34		$	1.25		$	2.47		$	2.36
Income tax impact of non-GAAP adjustments(3)		(0.03)			(0.01)
Intangible asset amortization(1)		0.03			0.10			0.05			0.18
Non-GAAP diluted EPS	$	1.20		$	1.15
Restructuring charges(2)		(0.03)			(0.03)			0.04			(0.07)
Loss on investments		-			-			-			0.02
Gain on sale of subsidiary, net(3)		-			(0.10)			-			(0.10)
Income tax impact of non-GAAP adjustments(4)		-			-			(0.02)			(0.02)
Non-GAAP diluted EPS	$	1.34		$	1.22		$	2.54		$	2.37

For additional information regarding the nature of charges discussed below, refer to Note 1, Basis of Presentation, Note 2, Restructuring, and Note 3, Goodwill and Intangible Assets, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q.

(1)Represents the non-cash amortization of definite-lived intangible assets associated with acquisitions, including customer relationships, tradenames and developed technology assets.

(2)Represents ~~restructuring~~ charges related to ~~the~~employee ~~Fiscal~~termination ~~2024~~benefits ~~Restructuring~~and ~~Initiative~~subsequent ~~and~~adjustments ~~the~~from ~~Fiscal~~higher-than-expected ~~2023~~employee ~~Resource~~retention ~~Optimization~~associated ~~Initiative~~with enterprise-wide restructuring initiatives.

(3)~~The~~Represents ~~non-GAAP adjustments primarily relate to~~ the ~~U.S.~~gain ~~As such, the income tax charge~~ on ~~the~~sale ~~U.S.~~of ~~non-GAAP~~a ~~adjustments~~Mexico issubsidiary ~~calculated~~subsequent ~~using~~to ~~the~~our ~~statutory~~exit ~~tax~~from ~~rate~~operations ofin 24Mexico.~~5%.~~

~~Non~~(4)The non-GAAP ~~operating~~adjustments primarily relate to the U.S. and Mexico. As such, the forecasted annual income ~~rate~~tax ~~increased~~charge inon the ~~first~~U.S. ~~quarter~~non-GAAP adjustments is calculated using the statutory tax rate of ~~fiscal~~24.5%. ~~2025~~There is no forecasted annual income tax charge for Mexico non-GAAP items, ~~primarily~~as ~~due~~there tois ano ~~favorable~~forecasted ~~gross~~annual ~~profit~~tax ~~rate~~expense on the income in ~~our~~the ~~Domestic~~calculation ~~segment~~of GAAP income tax expense.

Non-GAAP effective tax rate increased in the first quarter of fiscal 2025, primarily due to reduced tax benefits from the resolution of tax matters and stock-based compensation, partially offset by benefits from green energy incentives.

Non-GAAP diluted EPS increased in the first quarter of fiscal 2025, primarily due to the increase in non-GAAP operating income.

Liquidity and Capital Resources

We closely manage our liquidity and capital resources. Our liquidity requirements depend on key variables, including the level of investment required to support our business strategies, the performance of our business, capital expenditures, dividends, credit facilities, short-term borrowing arrangements and working capital management. We modify our approach to managing these variables as changes in our operating environment arise. For example, capital expenditures and share repurchases are a component of our cash flow and capital management strategy, which, to a large extent, we can adjust in response to economic and other changes in our business environment.

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Non-GAAP operating income rate increased in the second quarter and first six months of fiscal 2025, primarily due to a favorable gross profit rate in our Domestic segment.

Non-GAAP effective tax rate decreased in the second quarter of fiscal 2025, primarily due to increased tax benefits from green energy incentives. Non-GAAP effective tax rate increased in the first six months of fiscal 2025, primarily due to reduced tax benefits from the resolution of tax matters and stock-based compensation, partially offset by increased tax benefits from green energy incentives.

Non-GAAP diluted EPS increased in the second quarter and first six months of fiscal 2025, primarily due to the increase in non-GAAP operating income.

Liquidity and Capital Resources

Cash and cash equivalents were as follows ($ in millions):

May 4, 2024

February 3, 2024

April 29, 2023

August 3, 2024

February 3, 2024

July 29, 2023

Cash and cash equivalents

1,~~214~~387

1,447

1,~~030~~093

The decrease in cash and cash equivalents from February 3, 2024, was primarily due to ~~the timing and volume of inventory purchases and payments,~~ dividend payments and capital expenditures, partially offset by positive cash flows from operations, primarily driven by earnings.

The increase in cash and cash equivalents from ~~April~~July 29, 2023, was primarily due to positive cash flows from operations, primarily driven by earnings, partially offset by dividend payments, capital expenditures and share repurchases.

Cash Flows

Cash flows were as follows ($ in millions):

Three Months Ended

Six Months Ended

May 4, 2024

April 29, 2023

August 3, 2024

July 29, 2023

Total cash provided by (used in):

Operating activities

~~156~~817

~~(331)~~181

Investing activities

(~~167~~352)

(~~204~~381)

Financing activities

(~~252~~557)

(~~281~~560)

Effect of exchange rate changes on cash and cash equivalents

(3)

(52)

Decrease in cash, cash equivalents and restricted cash

(~~266~~95)

(~~821~~762)

Operating Activities

The increase in cash provided by operating activities in the first ~~quarter~~six months of fiscal 2025 was primarily driven by the timing and volume of inventory purchases and payments, partially offset by the timing of vendor funding receivables ~~and higher incentive compensation payments in the current year~~.

Investing Activities

Cash used in investing activities in the first ~~quarter~~six months of fiscal 2025 decreased, primarily driven by lower capital spending. We currently expect capital expenditures to approximate $750 million in fiscal 2025 compared to $795 million in fiscal 2024.

Financing Activities

~~The~~Cash ~~decrease in cash~~ used in financing activities in the first ~~quarter~~six months of fiscal 2025 ~~was~~remained ~~primarily~~relatively ~~driven~~consistent bywith ~~lower~~the ~~share~~comparable ~~repurchases~~prior-year period.

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Sources of Liquidity

Funds generated by operating activities, available cash and cash equivalents, our credit facilities, other debt arrangements and trade payables are our most significant sources of liquidity. We believe our sources of liquidity will be sufficient to fund operations and anticipated capital expenditures, share repurchases, dividends and strategic initiatives, including business combinations. However, in the event our liquidity is insufficient, we may be required to limit our spending. There can be no assurance that we will continue to generate cash flows at or above current levels or that we will be able to maintain our ability to borrow under our existing credit facilities or obtain additional financing, if necessary, on favorable terms.

Restricted Cash

Our liquidity is also affected by restricted cash balances that are primarily restricted to cover product protection plans provided under our membership offerings and ~~other~~ self-insurance liabilities. Restricted cash, which is included in Other current assets on our Condensed Consolidated Balance Sheets, was $~~313~~311 million, $346 million and $~~402~~398 million at ~~May~~August 43, 2024, February 3, 2024, and ~~April~~July 29, 2023, respectively. The decrease in restricted cash from ~~April~~February 3, 2024, and July 29, 2023, was primarily due to releases of product protection reserves based on claims and purchasing behaviors of customers participating in our membership offerings.

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Debt and Capital

As of ~~May~~August 43, 2024, we had $500 million of principal amount of notes due October 1, 2028, and $650 million of principal amount of notes due October 1, 2030. Refer to Note 6, Debt, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q, and Note 8, Debt, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024, for additional information about our outstanding debt.

Share Repurchases and Dividends

We repurchase our common stock and pay dividends pursuant to programs approved by our Board of Directors (“Board”). The payment of cash dividends is also subject to customary legal and contractual restrictions. Our long-term capital allocation strategy is to first fund operations and investments in growth and then return excess cash over time to shareholders through dividends and share repurchases while maintaining investment-grade credit metrics. Our share repurchase plans are evaluated on an ongoing basis, considering factors such as our financial condition and cash flows, our economic outlook, the impact of tax laws, our liquidity needs, and the health and stability of global credit markets. The timing and amount of future repurchases may vary depending on such factors.

On February 28, 2022, our Board approved a $5.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under this authorization.

Share repurchase and dividend activity were as follows ($ and shares in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	May 4, 2024		April 29, 2023
	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Total cost of shares repurchased	$	5298	$	8169	$	150	$	150
Average price per share	$	7782.8157	$	76.1588	$	80.86	$	76.48
Total number of shares repurchased		01.71		10.19		1.8		2.0
Regular quarterly cash dividend per share	$	0.94	$	0.92	$	1.88	$	1.84
Cash dividends declared and paid	$	~~202~~203	$	~~202~~200	$	405	$	402

The total cost of shares repurchased ~~decreased~~increased in the ~~first~~second quarter of fiscal 2025, primarily due to aan increase in the volume of repurchases. The total cost of shares repurchased remained consistent in the first six months of fiscal 2025, as the decrease in the volume of repurchases was offset by the increase in the average price per share. Cash dividends declared and paid ~~remained~~increased ~~consistent~~ during the ~~first~~second quarter and first six months of fiscal 2025, due to the increase in the regular quarterly cash dividend per share, partially offset by fewer shares outstanding.

Between the end of the ~~first~~second quarter of fiscal 2025 on ~~May~~August 43, 2024, and ~~June~~September 54, 2024, we repurchased an incremental 0.4 million shares of our common stock at a cost of $3439 million. We currently expect total share repurchases of approximately $~~350~~500 million in fiscal 2025.

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Off-Balance-Sheet Arrangements and Contractual Obligations

Our liquidity is not dependent on the use of off-balance-sheet financing arrangements other than in connection with our $1.25 billion in undrawn capacity on our Five-Year Facility Agreement as of ~~May~~August 43, 2024, which, if drawn upon, would be included in either short-term or long-term debt on our Condensed Consolidated Balance Sheets.

There has been no material change in our contractual obligations other than in the ordinary course of business since the end of fiscal 2024. See our Annual Report on Form 10-K for the fiscal year ended February 3, 2024, for additional information regarding our off-balance-sheet arrangements and contractual obligations.

Significant Accounting Policies and Estimates

We describe our significant accounting policies in Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, and our critical accounting estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024. There have been no significant changes in our significant accounting policies or critical accounting estimates since the end of fiscal 2024.

New or Recently Issued Accounting Pronouncements

For a description of applicable new or recently issued accounting pronouncements, including our assessment of the impact on our financial statements, see Note 1, Basis of Presentation, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q.

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Safe Harbor Statement Under the Private Securities Litigation Reform Act

Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), provide a “safe harbor” for forward-looking statements to encourage companies to provide prospective information about their companies. With the exception of historical information, the matters discussed in this Quarterly Report on Form 10-Q are forward-looking statements and may be identified by the use of words such as “anticipate,” “appear,” “approximate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “foresee,” “guidance,” “intend,” “may,” “might,” “outlook,” “plan,” “possible,” “project,” “seek,” “should,” “would,” and other words and terms of similar meaning or the negatives thereof. Such statements reflect our current views and estimates with respect to future market conditions, company performance and financial results, operational investments, business prospects, our operating model, new strategies and growth initiatives, the competitive environment, consumer behavior and other events. These statements involve a number of judgments and are subject to certain risks and uncertainties, many of which are outside the control of the Company, that could cause actual results to differ materially from the potential results discussed in such forward-looking statements. Readers should review Item 1A, Risk Factors, of our most recent Annual Report on Form 10-K, and any updated information in subsequent Quarterly Reports on Form 10-Q, for a description of important factors that could cause our actual results to differ materially from those contemplated by the forward-looking statements made in this Quarterly Report on Form 10-Q. Among the factors that could cause actual results and outcomes to differ materially from those contained in such forward-looking statements are the following: macroeconomic pressures in the markets in which we operate (including but not limited to recession, inflation rates, fluctuations in foreign currency exchange rates, limitations on a government’s ability to borrow and/or spend capital, fluctuations in housing prices, energy markets, jobless rates and effects related to the conflicts in Eastern Europe and the Middle East or other geopolitical events); catastrophic events, health crises and pandemics; susceptibility of the products we sell to technological advancements, product life cycle fluctuations and changes in consumer preferences; competition (including from multi-channel retailers, e-commerce business, technology service providers, traditional store-based retailers, vendors and mobile network carriers and in the provision of delivery speed and options); our ability to attract and retain qualified employees; changes in market compensation rates; our expansion into health and new products, services and technologies; our focus on services as a strategic priority; our reliance on key vendors and mobile network carriers (including product availability); our ability to maintain positive brand perception and recognition; our ability to effectively manage strategic ventures, alliances or acquisitions; our ability to effectively manage our real estate portfolio; inability of vendors or service providers to perform components of our supply chain (impacting our stores or other aspects of our operations) and other various functions of our business; risks arising from and potentially unique to our exclusive brands products; risks associated with vendors that source products outside of the U.S.; our reliance on our information technology systems, internet and telecommunications access and capabilities; our ability to prevent or effectively respond to a cyber-attack, privacy or security breach; product safety and quality concerns; changes to labor or employment laws or regulations; risks arising from statutory, regulatory and legal developments (including statutes and/or regulations related to tax or privacy); evolving corporate governance and public disclosure regulations and expectations (including, but not limited to, cybersecurity and environmental, social and governance matters); risks arising from our international activities (including those related to the conflicts in Eastern Europe and the Middle East or fluctuations in foreign currency exchange rates) and those of our vendors; failure to effectively manage our costs; our dependence on cash flows and net earnings generated during the fourth fiscal quarter; pricing investments and promotional activity; economic or regulatory developments that might affect our ability to provide attractive promotional financing; constraints in the capital markets; changes to our vendor credit terms; changes in our credit ratings; and failure to meet financial-performance guidance or other forward-looking statements. We caution that the foregoing list of important factors is not complete. Any forward-looking statements speak only as of the date they are made and we assume no obligation to update any forward-looking statement that we may make.

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Item 3.Quantitative and Qualitative Disclosures About Market Risk

As disclosed in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024, in addition to the risks inherent in our operations, we are exposed to certain market risks.

Interest Rate Risk

We are exposed to changes in short-term market interest rates and these changes in rates will impact our net interest expense. Our cash, cash equivalents and restricted cash generate interest income that will vary based on changes in short-term interest rates. In addition, we have swapped a portion of our fixed-rate debt to floating rate such that the interest expense on this debt will vary with short-term interest rates. Refer to Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024, for further information regarding our interest rate swaps.

As of ~~May~~August 43, 2024, we had $1.57 billion of cash, cash equivalents and restricted cash and $0.5 billion of debt that has been swapped to floating rate, and therefore the net asset balance exposed to interest rate changes was $1.02 billion. As of ~~May~~August 43, 2024, a 50-basis point increase in short-term interest rates would have led to an estimated $56 million increase in interest income, and conversely a 50-basis point decrease in short-term interest rates would have led to an estimated $56 million decrease in interest income.

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Foreign Currency Exchange Rate Risk

We have market risk arising from changes in foreign currency exchange rates related to operations in our International segment. On a limited basis, we utilize foreign exchange forward contracts to manage foreign currency exposure to certain forecasted inventory purchases, recognized receivable and payable balances and our investment in our Canadian operations. Refer to Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2024, for additional information regarding these instruments.

In the ~~first~~second quarter and first six months of fiscal 2025, foreign currency exchange rate fluctuations were ~~primarily~~ driven by the strength of the U.S. dollar against the Canadian dollar compared to the prior-year period. ~~Foreign~~We estimate that the foreign currency exchange rate fluctuations ~~did~~had ~~not~~an ~~have~~unfavorable ~~a significant~~ impact on our revenue orof approximately $18 million and $19 million in the second quarter and first six months of fiscal 2025, respectively. The impact of foreign exchange rate fluctuations on our net earnings in the ~~first~~second quarter and first six months of fiscal 2025 was not significant.

Item 4.Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s (“SEC”) rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (principal executive officer) and Senior Executive Vice President of Enterprise Strategy and Chief Financial Officer (principal financial officer), to allow timely decisions regarding required disclosure. We have established a Disclosure Committee, consisting of certain members of management, to assist in this evaluation. The Disclosure Committee meets on a regular quarterly basis and more often if necessary.

Our management, including our Chief Executive Officer and Senior Executive Vice President of Enterprise Strategy and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act), at ~~May~~August 43, 2024. Based on that evaluation, our Chief Executive Officer and Senior Executive Vice President of Enterprise Strategy and Chief Financial Officer concluded that, at ~~May~~August 43, 2024, our disclosure controls and procedures were effective.

There were no changes in internal control over financial reporting during the fiscal quarter ended ~~May~~August 43, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1.Legal Proceedings

For information about our legal proceedings, see Note 10, Contingencies, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q.

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Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

c) Stock Repurchases

On February 28, 2022, our Board approved a $5.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under this authorization. For additional information, see Note 9, Repurchase of Common Stock, of the Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Fiscal Period	Total Number of‎Shares Purchased	Average Price Paid‎per Share		Total Number of Shares Purchased as Part of Publicly Announced Program		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
February 4, 2024 through March 2, 2024	10,360	$	78.42		10,360	$	3,783,000,000
May 5, 2024 through June 1, 2024	389,162	$	74.00		389,162	$	3,703,000,000
March 3, 2024 through April 6, 2024	308,226	$	79.50		308,226	$	3,759,000,000
June 2, 2024 through July 6, 2024	433,510	$	86.81		433,510	$	3,666,000,000
April 7, 2024 through May 4, 2024	347,784	$	76.30		347,784	$	3,732,000,000
July 7, 2024 through August 3, 2024	360,052	$	86.73		360,052	$	3,635,000,000
Total fiscal 2025 first quarter	666,370	$	77.81		666,370	$	3,732,000,000
Total fiscal 2025 second quarter	1,182,724	$	82.57		1,182,724	$	3,635,000,000

Item 5.Other Information

Rule 10b5-1 Plan Elections

~~During~~Set ~~the~~forth ~~fiscal~~below ~~quarter~~are ~~ended~~developments ~~May~~regarding 4,trading ~~2024,~~plan ~~none~~arrangements ofamong ~~the~~our ~~Company's~~ directors orand officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended) ~~adopted, terminated or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement~~ (asthe ~~such~~“Exchange ~~terms~~Act”)) ~~are~~for ~~defined in Item 408 of Regulation S-K of~~ the ~~Securities~~quarter ~~Act~~ended ~~of 1933~~August 3, ~~as amended)~~2024.

24On June 6, 2024, Corie Barry, the Company’s Chief Executive Officer and a director, entered into a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act, providing for the potential sale of up to 79,829 shares of our common stock through September 17, 2024.

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Item 6.Exhibits

3.1	Amended and Restated Articles of Incorporation (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Best Buy Co., Inc. on June 12, 2020).
3.2	Amended and Restated By-Laws (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Best Buy Co., Inc. on June 14, 2018).
10.1*	Form of Best Buy Co., Inc. Long-Term Incentive Program Award Agreement (2024) – ~~Restricted Shares~~Directors.
10.2*	Form of Best Buy Co., Inc. Long-Term Incentive Program Award Agreement (2024) – Restricted Stock Units.
10.3*	Policy Regarding Shareholder Ratification of Executive Officer Cash Severance Agreements (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Best Buy Co., Inc. on March 7, 2024).
10.4*	Restated Best Buy Severance Plan and Summary Plan Description (2023).
31.1	Certification of the Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of the Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(1).
32.2	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(1).
101	The following financial information from our Quarterly Report on Form 10-Q for the ~~first~~second quarter of fiscal 2025, filed with the SEC on ~~June~~September 76, 2024, formatted in Inline Extensible Business Reporting Language (“iXBRL”): (i) the Condensed Consolidated Balance Sheets as of ~~May~~August 43, 2024, February 3, 2024, and ~~April~~July 29, 2023, (ii) the Condensed Consolidated Statements of Earnings for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023, (iii) the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023, (iv) the Condensed Consolidated Statements of Cash Flows for the ~~three~~six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023, (v) the Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and six months ended ~~May~~August 43, 2024, and ~~April~~July 29, 2023, and (vi) the Notes to Condensed Consolidated Financial Statements.
104	The cover page from our Quarterly Report on Form 10-Q for the ~~first~~second quarter of fiscal 2025, filed with the SEC on ~~June~~September 76, 2024, formatted in iXBRL (included as Exhibit 101).

(1)The certifications in Exhibit 32.1 and Exhibit 32.2 to this Quarterly Report on Form 10-Q shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section and shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

* Management contracts or compensatory plans or arrangements

Pursuant to Item 601(b)(4)(iii) of Regulation S-K under the Securities Act of 1933, as amended, the registrant has not filed as exhibits to this Quarterly Report on Form 10-Q certain instruments with respect to long-term debt under which the amount of securities authorized does not exceed 10% of the total assets of the registrant. The registrant hereby agrees to furnish copies of all such instruments to the SEC upon request.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BEST BUY CO., INC.
	(Registrant)
Date: June 7, 2024	By:	/s/ CORIE BARRY
Date: September 6, 2024	By:	/s/ CORIE BARRY
		Corie Barry
		Chief Executive Officer
Date: June 7, 2024	By:	/s/ MATTHEW BILUNAS
Date: September 6, 2024	By:	/s/ MATTHEW BILUNAS
		Matthew Bilunas
		Senior Executive Vice President of Enterprise Strategy and Chief Financial Officer
Date: June 7, 2024	By:	/s/ MATHEW R. WATSON
Date: September 6, 2024	By:	/s/ MATHEW R. WATSON
		Mathew R. Watson
		Senior Vice President, Finance – Controller and Chief Accounting Officer

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