UPDATE 2-Best Buy profit beats on strong demand for TVs, smartphones
(Adds company comment, details on online and international business, updates shares)
By Nandita Bose and Ramkumar Iyer
May 21 (Reuters) - Best Buy Co Inc, the largest U.S. consumer electronics chain, reported better-than-expected quarterly profit and sales, helped by strong demand for smartphones and large-screen TVs, sending its shares up over 8 percent.
Best Buy, whose profits have benefited from cost-cutting lately, will continue to focus on aggressively pursuing its cost cutting initiatives this year. In March, the company said it planned this year to start a cost-cutting effort to save $400 million over the next three years.
"These savings are not expected to begin until the back half of fiscal 2016," Chief Executive Hubert Joly said on an earnings conference call.
Since 2012, Best Buy has cut jobs, removed layers of management and closed stores.
Best Buy said its revenue growth in the United States was driven by sales of mobile phones bundled with billing plans by telecom carriers. Under these plans, telecom carriers allow customers to buy new phones for a low down payment and pay the remaining amount in installments along with monthly bills.
Revenue from the U.S. rose 1.4 percent to $7.9 billion in the first quarter. However, same-store sales fell 0.7 percent.
For the second quarter, the company said it expected "a flat to positive low-single digit revenue growth rate" in its U.S. business and "a flat to negative low-single digit revenue growth rate" in its overall business. Continued...