Best Buy Q1 FY26 Earnings Report: Hit by Trump’s Tariff War, BBY Slashes Full-Year Guidance

TradingKey - As the largest U.S. consumer electronics and appliance retailer, Best Buy (BBY) has been directly affected by Trump’s tariff policies targeting China, its biggest supplier. In Q1 of fiscal 2026, Best Buy reported weaker-than-expected results and issued a profit warning—sending shares down more than 10% intraday.

On Thursday, May 29, Best Buy released its earnings for the first quarter ended May 3, 2025 :

• Revenue declined to $8.767 billion from $8.847 billion in the prior year, missing estimates of $8.81 billion
• Adjusted EPS came in at $1.15, slightly above expectations of $1.09

However, comparable sales fell 0.7% year-over-year, driven by weak demand in home theater systems, appliances, and drones, partially offset by growth in computers, smartphones, and tablets.

Supply Chain Pain From Tariffs

Best Buy is best known for selling products like iPhones, TVs, laptops, and kitchen appliances, most of which are imported from China and other Asian countries. As the company's largest sourcing country, China previously accounted for 55% of imports—now reduced to 30–35% due to supply chain adjustments.

Back in March, Best Buy warned it would likely raise prices to offset rising import costs. Some price hikes have already taken effect since mid-May.

During the earnings call, the company said it was actively working with suppliers to mitigate tariff-related cost pressures while maintaining product availability.

Downgraded Outlook

Given ongoing trade tensions and sustained tariffs, Best Buy revised its full-year guidance:

• Comparable sales are now expected to grow within a ±1% range, down from the previous forecast of +2%
• Adjusted EPS is projected between $6.15 and $6.30, below the earlier estimate of $6.20 to $6.60

Following the release, Best Buy shares dropped 7.27% to $66.32, bringing its year-to-date loss to 23% in 2025.

Retail Sector Under Pressure

Best Buy is not alone in facing pressure from Trump’s tariff policies.

Major U.S. retailers including Walmart and Macy’s have also withdrawn or lowered their earnings forecasts due to rising import costs and weakening consumer confidence.

What’s Next for Trump’s Tariff Policy?

Notably, there may be major shifts ahead in Trump’s tariff strategy:

• Ongoing U.S.-China trade negotiations could lead to further tariff reductions
• A federal court challenge is currently underway over the legality of Trump’s tariff actions

Investors will be closely watching whether these developments bring relief to U.S. retailer —or intensify the pain.