Nintendo Switch helps Best Buy fight off decline

The launch of Nintendo Switch proved to be a key boost for Best Buy in its first financial quarter of the year.

Bloomberg reports that analysts had previously predicted a quarterly decline for the electronics retail chain, but the company not only topped projections, it also saw same-store sales increase by 1.6% - flying in the face of expectations of a 1.5% decline.

Best Buy's shares also rose to a record high - up by 19% to $59.92 in New York trading, said to be "the biggest intraday increase since August". By comparison, the shares had only gained by 18% from January 1st to May 24th.

The increase was not solely down to excitement for the Nintendo Switch. Laptops, previously a category in decline, also saw "robust gains" according to the report - thanks in part to new premium models from the likes of Microsoft and similar firms, which sold for over $500.

E-commerce sales rose 23% last quarter, driven in part by revamped stores that featured areas dedicated to specific brands, such as Apple, Microsoft and Samsung. Entertainment sales, which includes video games, rose by 11 per cent - reportedly the best performance for the company since 2014.

After a few troubled years which has seen its international business shrink, Best Buy has said that 2017 will be the year it returns to growth mode and these results certainly support that optimism. Looking to the quarter ahead, the chain expects further same-sales growth of between 1.5% and 2.5%, with revenues of up to $8.7bn.

Bloomberg reports that Best Buy is not the only electronics retailer to benefit from the Switch's debut. Rival chain Target said its electronic sales had "leapt forward" thanks to the new console. In fact, government data cited by RBC Capital Markets reveals the electronics category for retail overall saw its first monthly gain in almost two years.