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Best Buy streamlines U.S. ops, expects lower profits

MINNEAPOLIS — Best Buy is streamlining its U.S. operations by implementing a leaner leadership structure.

Effective Jan. 1, 2013, the company's U.S. operations will consist of the online channel, overseen by Stephen Gillett, president digital and marketing; and retail channel, overseen by Shawn Score. In additon, the U.S. operations will consist of three business groups -- connectivity, home and services -- lead by Jude Buckley, Mike Mohan and George Sherman, respectively. Support functions including human resources, finance, legal and marketing will see no leadership changes.

"One thing I have learned in helping turn companies around is that a business needs to have a nimble organization," said Best Buy President and CEO Hubert Joly. "Our new organization will help build a closer connection to our customers and front line employees, as well as accelerate our transformation."

The new groups will report directly to Joly. The current president of Best Buy's U.S. business, Mike Vitelli, will retire from the company at the end of the fiscal year. He will work closely with Joly to ensure a smooth transition. EVP U.S. Operations Tim Sheehan will leave the company at the end of the month.

"Shawn Score and Jude Buckley have done a great job growing Best Buy Mobile and then leading the Connectivity Business Group. I look forward to working with them and the rest of our team as we re-invigorate and rejuvenate Best Buy," said Joly. "Mike Vitelli and I will work closely together during the next few months to ensure a smooth transition. I am very grateful to him for everything he has done for the company and for his terrific support."

For the third quarter ending Nov. 3, Best Buy expects comparable-store sales to decline at a rate consistent with the range of results for the first two quarters of fiscal 2013 (-5.3% in the first quarter and -3.2% in the second quarter). The company also expects fiscal third quarter adjusted (non-GAAP) earnings per diluted share will be significantly below the prior-year period.

The company plans to release fiscal third quarter 2013 results on Tuesday, Nov. 20,

 

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