TheChek News Flow

Reports Q3 (Oct) earnings of $0.32 per share, excluding non-recurring items, $0.07 better than the Capital IQ Consensus Estimate of $0.25; revenues rose 0.6% year/year to $9.38 bln vs the $9.11 bln consensus.

• Comps +2.2% vs. -1.7% consensus and guidance for low single digit decline in 2H15.
• On the top line, while sales in the NPD-reported Consumer Electronics categories declined 0.2%4, our strength in televisions, computing, and tablets versus the industry, in addition to our growth in gaming and appliances, drove a Domestic comparable sales increase of 2.4%, excluding the 80-basis point estimated benefit associated with the classification of revenue for the new mobile carrier installment billing plans2. Domestic online comparable sales increased 22%."
• $65 million in additional annualized Renew Blue cost reductions, bringing the cumulative total to $965 million
  

Co issues upside guidance for Q4, sees Q4 revs of flat YoY from $14.47 bln vs. $14.25 bln Capital IQ Consensus; near flat year-over-year revenue and comparable sales growth (previously said comps down low single digits for 2H15) -- assuming revenue declines in the NPD-reported Consumer Electronics categories are in line with Q3 FY15; (2) an improvement in the year-over-year gross profit rate (consensus +20 bps to 20.4%). The net result of these outcomes, similar to last quarter's outlook, is expected to equate to a year-over-year expansion in the Q4 non-GAAP operating income rate of ~50 basis points (similat to last quarter's guiance for 2H15).