Unexpected Sales thrill both Best Buy and Circuit Stores

Unexpected sales thrilled both Best Buy and Circuit Stores, the largest electronics retailers in the United States. The sales were more than the anticipated estimates of the analysts.

The sales of Best Buy increased at least by 7 percent, while that of Circuit City Stores increased by 4.2 percent. The increase in the sales was attributed to strong demand for flat-panel televisions. Both the retailers have increased the sales forecasts for the rest of the fourth quarter.

The increased sales boosted the shares price by more than 2 percent in the early trade Friday on the New York Stock Exchange. The share price of Best Buy was at $51.42 with an increment of $1.58, and that of Circuit City Stores was at $20.65 with an increase of $0.65.

"In December, sales results were stronger than our expectations in the second half of the month, and, therefore, we are raising our sales guidance for fiscal 2007," Philip Schoonover, chairman, president and chief executive, said in a statement.

The top US consumer electronics retail chain, Best Buy said that the sales that stays open for 14 months while Circuit City Stores Inc. said sales at stores remain open throughout the year.

The electronic goods’ retailers were happy because of the high sales of electronic goods during holiday season as prices for flat-panel televisions plunged, and digital cameras, laptop computers and MP3 players were heavily promoted by them to draw shoppers into their stores.

Right from the week of Thanksgiving till Dec 23rd, the sales of consumer technology increase by about 6.5 percent says the NPD Group that tracks the weekly point-of-scale data from retailers. It also said that the revenue rise calculated, which does not include Christmas Eve shopping, was actually obstructed by the falling prices of the flat-panel televisions.

The hot selling electronic goods of the season were flat-panel LCD and plasma televisions. However, these were further promoted by the retailers by giving lot of other offers.

According to NPD, there was a decline of 41 percent in the average selling price of a 32-inch LCD television. It fell to $796 this year from $1,354 a year ago.