Best Buy Co., Inc. (NYSE: BBY) today announced results for the 13-week first quarter ended May 1, 2021 (“Q1 FY22”), as compared to the 13-week first quarter ended May 2, 2020 (“Q1 FY21”).

Best Buy CFO Matt Bilunas said, “The year has clearly started out much stronger than we originally expected. The sales momentum is continuing into Q2 and we are raising our annual comparable sales growth outlook. As we think about the back half of this year, we expect shopping behavior will evolve as customers are able to spend more time on activities like eating out, traveling and other events. It is difficult to know exactly how that impacts our business, especially as we lap particularly strong sales in the back half of last year. Therefore, at this time, we are leaving our original FY22 back-half sales assumptions unchanged.”

The company is providing the following outlook:

FY22:

• Enterprise comparable sales growth of 3% to 6%, which compares to prior outlook of (-2%) to 1%
• Enterprise non-GAAP gross profit rate²  approximately flat to the FY21 rate of 22.4%, which compares to prior outlook of slightly below the FY21 rate of 22.4%
• Enterprise non-GAAP SG&A²  growth rate of 6% to 7%, which compares to prior outlook of a growth rate in the low single-digits
• Share repurchases of approximately $2.5 billion, which compares to prior outlook of at least $2.0 billion
• Capital expenditures of $750 million to $850 million, which remains unchanged

Q2 FY22:

• Enterprise comparable sales growth of approximately 17%
• Enterprise non-GAAP gross profit rate²  approximately flat to the Q2 FY21 rate of 22.9%
• Enterprise non-GAAP SG&A²  growth of approximately 20%

Domestic Segment Q1 FY22 Results

Domestic Revenue

Domestic revenue of $10.84 billion increased 37.0% versus last year. The increase was primarily driven by comparable sales growth of 37.9%, which was partially offset by the loss of revenue from permanent store closures in the past year.

From a merchandising perspective, the company generated comparable sales growth across almost all its categories, with the largest drivers being home theater, computing and appliances.

Domestic online revenue of $3.60 billion increased 7.6% on a comparable basis, primarily due to higher average order values and increased traffic. As a percentage of total Domestic revenue, online revenue was 33.2% versus 42.2% last year.

Domestic Gross Profit Rate

Domestic gross profit rate was 23.3% versus 23.0% last year. The gross profit rate increase of approximately 30 basis points was primarily driven by improved product margin rates, including reduced promotions, and rate leverage from supply chain costs. These items were partially offset by increased installation and delivery costs.

Domestic Selling, General and Administrative Expenses (“SG&A”)

Domestic GAAP SG&A was $1.84 billion, or 16.9% of revenue, versus $1.58 billion, or 19.9% of revenue, last year. On a non-GAAP basis, SG&A was $1.82 billion, or 16.8% of revenue, versus $1.56 billion, or 19.7% of revenue, last year. Both GAAP and non-GAAP SG&A increased primarily due to: (1) increased incentive compensation expense; (2) increased investments in technology and in support of the company’s health initiatives; and (3) increased variable expense related to the higher sales growth, including items such as credit card processing fees.

International Revenue

International revenue of $796 million increased 23.0% versus last year. This increase was primarily driven by comparable sales growth of 27.8% and the benefit of approximately 1,000 basis points of favorable foreign currency exchange rates. These items were partially offset by lower revenue in Mexico of $69 million, which was a result of the company exiting operations from the country, as previously announced on November 24, 2020.

CWEB Analyst’s have initiated a STRONG BUY Rating for   Best Buy Co., Inc. (NYSE: BBY) and potential upside of $259 by end of 2021. Best Buy’s first-quarter net income rose to $595 million, or $2.32 per share, up from $159 million, or 61 cents per share, a year earlier. Excluding items, it earned $2.23 per share, more than the $1.39 per share. Staggering revenues will continue to boost in the bottom line in Q2

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Apple has released iOS 14.6 update for its iPhones. As usual, the company has quietly fixed issues that were prevalent after its earlier update. Apple Music issues have also been resolved according to many users, security bugs have been fixed and a slew of features have been added. A new beta build version has also been released but it not recommended for download unless the user is a tester.

The new update was released on May 24. It can be downloaded on phones starting from iPhone 6S and higher. It can also be upgraded if your phone has any of the earlier 14 iOS versions. If you have an iPad there is a similar upgrade called iPadOS 14.6

Some of the new features that are available with iOS 14.6 are

• Apple Podcasts subscriptions
• Apple Music upgraded to spatial audio lossless audio (to be available in June)
• Updates for Air Tags
• Changes in voice control
• Quicker shortcuts
• New options in Apple Podcasts
• Apple Card Family
• Security fixes

Although the announcements of Apple Podcasts for subscribers would be ad free and would include extra features were made earlier, it is available only after this upgrade was released. The same with Apple Music upgrades as we had reported on our website Cweb that Spatial Audio and Lossless Audio was rumored to be a part of the next upgrade and both these features have been added to iOS 14.6.

It was   mentioned that Apple would be launching App Tracking Transparency. This feature which will give users a choice to turn off social media tracking. This had resulted in a huge spat with Facebook, who ostensibly said that small advertisers would suffer but in internal discussions many Facebook employees acknowledged that Facebook would lose the most in advertising revenues.

Some of the smaller changes that have been released with iOS 14.6 include

• AirPlay 2 support for Apple Fitness+
• Updated Reminders app
• Siri can call emergency services
• Bug fixes

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On Wednesday, HCA Healthcare a health conglomerate that operates 186 hospitals and almost 2,000 care sites in the U.S. have struck a deal with Alphabet’s Google Cloud. The Wall Street Journal was the first agency to report the news. The hospital will use the tech giant’s technology to develop new algorithms that will help its doctors in diagnosis. HCA says that it will scrub patients’ names from shared records but there are several concerns on privacy issues.

The Nashville, Tennessee based hospital chain said that it will use Google Cloud to store its digital health records of its patients. HCA also said that it would use anonymized patients’ records with Google’s Artificial Intelligence technology to give the best treatment to its patients. HCA’s database has records of 32 million patients.

An HCA spokesman told the Daily Mail that their contract prohibits Google Cloud from using identifiable information of patients. The statement also said that access to any data was prohibited without permission from HCA.

There is no clarity on the financial aspects of the deal between the two huge companies. No mention has been made about the proprietorship of the algorithm that will be developed as it is a combined effort between the two – HCA will provide the patients’ data and Google’s AI will be the technology behind the algorithm. It is unclear whether the algorithm will belong to HCA or to Google.

In a statement HCA said that privacy and security would be the guiding principles throughout the partnership. It added that the access and use of patient data would be addressed through the implementation of the Google Cloud ‘s infrastructure as well as the layers of security controls and processes that are available at HCA Healthcare.

Google has ventured into the health care system before when it partnered with Ascension, which was also first reported by the Wall Street Journal. However, Google is not the only large tech company that   has partnered with health care groups as healthcare is a lucrative $3 trillion industry and has also attracted partnerships with Google’s tech rivals, Amazon and Microsoft.

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