Best Buy CEO raises red flag about startling customer behavior

Patricia Battle

Sat, May 31, 2025, 10:03 AM 4 min read

“We see a consumer who is seeking value and sales events, and they are willing to spend on higher price points when they need to or when they see compelling new technology…” said Barry. “And there are some categories where, if you take something like televisions, we can definitely see consumers trying to make some of those value trade-offs. But at the same time, we see this continued strength in computing and tablets, where there’s both need and innovation, and they’re willing to go ahead and spend in those areas."

Best Buy has seen consumers buying less in major categories.Image source&colon; Bloomberg/Getty Images — Best Buy has seen consumers buying less in major categories.Image source: Bloomberg/Getty Images

Best Buy recently made a harsh change in stores

The persistent pattern in customer behavior also comes during a time when Best Buy has begun increasing its prices in response to President Donald Trump’s recent tariff announcements (tariffs are taxes companies pay to import goods from overseas).

Last month, Trump imposed a 10% baseline tariff on all countries and paused reciprocal tariffs. The pause on reciprocal tariffs will end in July, and as a result, roughly 60 countries will soon see increased tariff rates. This will likely cause U.S. consumers to see inflated prices for goods.

Trump’s tariff policy has led to uncertainty, especially since it has been adjusted multiple times and was recently challenged in federal court.

“I want to make the point that due to mitigation efforts by both vendors and by Best Buy, the increased product costs that are flowing to us are lower than the tariff rates,” said Barry. “And as of mid-May, we have already made the related price and promotional adjustments to our assortment. I also want to stress that, as always, we are committed to offering competitive prices to our customers.”

She also emphasized that raising prices is a “last resort” and that Best Buy is taking other initiatives to handle tariffs. This includes negotiating the costs of goods with vendors, finding alternative countries to source products from, modifying and consolidating product assortments it offers to customers, and working with vendors to create new manufacturing locations.

“As we look to the rest of the year, there is still uncertainty related to tariff levels, timing, and countries involved, in addition to the potential actions of others in the industry as well as the potential reaction of American consumers,” said Barry.

Best Buy makes grim prediction about future sales

Amid the uncertainty surrounding tariffs, Best Buy has lowered its sales expectations for the rest of the year. It now expects comparable sales this year to either decline by 1% or increase by 1%.

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“Our underlying working assumptions are that tariffs stay at the current levels for the rest of the year and there is no material change in consumer behavior from the trends we have seen in very recent quarters,” said Barry.

Best Buy's cautious outlook comes as many consumers are taking drastic measures to protect their finances amid Trump’s tariffs.

According to a recent survey from Harris Poll and Bloomberg News, 3 in 5 Americans said they are cutting back their spending due to concerns about a potential recession. More than 70% of Americans in the survey said they are eating out less, and 57% said they are spending less on entertainment.

Best Buy CEO raises red flag about startling customer behavior first appeared on TheStreet on May 31, 2025

This story was originally reported by TheStreet on May 31, 2025, where it first appeared.

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