Best Buy profits up as HDTV purchases increase

Major US consumer electronics retail chain Best Buy has reported its fourth quarter results, showing a major rise in profits to $644 million from $521 million a year ago as sales of flat panel televisions grew strongly.

Like for like sales were up 7.3 per cent for the chain, with overall revenues beating analyst estimates by hitting $10.69 billion, up from $9.23 billion in the same quarter last year.

Flat panel TVs - which are usually high definition sets - were fingered as the key growth area for the firm, and that growth is expected to continue this year as the prices of HDTV sets continue to fall to more affordable levels.

"This will be the first year when flat-panel truly becomes accessible to a broad customer group," chief financial officer Darren Jackson told news agency Reuters in an interview after the posting of the results.

The growing sales of HDTV displays is an important factor for the videogames industry, since HDTV is one of the key benefits of next-generation consoles such as the Xbox 360 and the PlayStation 3 - both of which insist that all software should work at HDTV resolutions.

Questions remain, however, over the speed at which HDTV sets will replace existing standard-definition sets, especially in Europe where widescreen and flat panel displays have a much wider installed base than in the United States, where many people buying HDTV sets are upgrading from 4:3 CRT sets.