The resignation of Chief Financial Officer Sharon McCollam, the architect of such Best Buy consumer-friendly improvements as “ship-from-store,” sent stock prices tumbling in late May, coupled with a disappointing second-quarter profits forecast for the electronics retailer.
McCollam, formerly chief operating officer at Williams-Sonoma, came out of retirement in 2012 to spearhead Best Buy’s refocus on consumer needs.
According to Yahoo Finance, McCollam’s role in giving Best Buy customers more access to inventory available in other retail stores and online distribution centers helped the company realize a 24% jump in domestic online sales. News of her departure saw shares drop nearly 8%.
Best Buy CEO Hubert Joly said the company’s online growth is but one area of improvement. In addition, Best Buy’s expanding mobile presence along with upgrades to its website have contributed to a richer consumer shopping experience.
By integrating its online service with its brick and mortar locations, customers can browse online first and then visit a Best Buy location to see a particular item, such as a 4K television, in person before purchasing.
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“The only way to see the quality of the picture and ask questions is really in the store,” Joly said, “but [a] better transaction may be completed in the store or online.”
McCollam is set to step down on June 14 but will remain as an advisor through January 28, 2017.
News of her departure came after Best Buy’s first-quarter net income increased to $229 million, a 77% jump. Overall, revenues fell to $8.4 billion in the quarter ending May 2, 2016. While earnings per share had risen to 71 cents – up from 37 cents in 2015 – Best Buy’s stock slipped 7.4% to close at $30.55, according to USA Today.
Earnings per share for the second quarter were expected to be about 12-to-13-cents less, in part due to an April earthquake in Japan that reduced availability of digital imaging products. The company also projected a flat same-store sales revenue performance in the second quarter.
McCollam will be succeeded by Corie Barry, Best Buy’s chief strategic growth officer.
Speaking to Yahoo Finance, Joly focused on the positive in light of McCollam’s departure, saying the company is “into the next phase of our journey.”
“It’s a lot of small changes,” Joly said. “We have a combination of what’s happening on the site, the shipping experience. We’ve improved in-store pickup so it’s an all-out effort, cumulative impact of the investments and improvements we’ve been making over the over the last three years.”
According to Yahoo Finance, investors continue to wait for Best Buy’s management to prove it can accelerate growth.