By Jinjoo Lee

Consumer-electronics retailer Best Buy has taken a stab at estimating how much tariffs could hit sales. The news isn't good.

-- If the 10% tariffs on China that began in February remain in place all year, that could cut 1 percentage point from comparable sales growth, the company said on its earnings call.

-- That will hurt: Without any tariffs, Best Buy had expected this measure of sales to be somewhere between flat and 2% up in the financial year ending in early 2026.

To make things worse, that estimate doesn't include the additional 10% tariff that President Trump imposed overnight on China, or the 25% tariffs on Canada and Mexico.

China and Mexico are the No. 1 and No. 2 sources for Best Buy products, respectively. The retailer itself only directly imports 2% to 3% of its overall offering, but said vendors will have to pass along some tariff costs to retailers.

Working out the end-result of tariffs is tricky because it all depends on how pinched consumers will feel. On the bright side, Best Buy says the industry is "in the guts of a replacement-and-upgrade cycle where people really need this stuff."

But tariffs will hit many sectors at once, including necessities such as groceries. That could make buyers very price-sensitive about discretionary purchases like laptops and gaming consoles. Little wonder Best Buy stock fell nearly 14% Tuesday morning.

This item is part of a Wall Street Journal live coverage event. The full stream can be found by searching P/WSJL (WSJ Live Coverage).

(END) Dow Jones Newswires

March 04, 2025 11:14 ET (16:14 GMT)

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