Best Buy operates internationally in Canada, and formerly operated in China until February 2011 (when the faction was merged with Five Star) and in Mexico until December 2020 (due to the effects of the COVID-19 pandemic). The company also operated in Europe until 2012. Its subsidiaries include Geek Squad, Magnolia Audio Video, and Pacific Sales. Best Buy also operates the Best Buy Mobile and Insignia brands in North America, plus Five Star in China. Best Buy sells cellular phones from Verizon Wireless, AT&T Mobility, T-Mobile, Boost Mobile and Ting Mobile in the United States. In Canada, carriers include Bell Mobility, Rogers Wireless, Telus Mobility, their fighter brands, and competing smaller carriers, such as SaskTel.
Best Buy was named \"Company of the Year\" by Forbes magazine in 2004, \"Specialty Retailer of the Decade\" by Discount Store News in 2001, ranked in the Top 10 of \"America's Most Generous Corporations\" by Forbes in 2005 (based on 2004 giving), made Fortune magazine's list of \"Most Admired Companies\" in 2006, and \"The Most Sustainable Company in the United States\" by Barron's in 2019. Hubert Joly is executive chairman of Best Buy, having been succeeded as CEO by Corie Barry in June 2019. According to Yahoo! Finance, Best Buy is the largest specialty retailer in the United States consumer electronics retail industry. The company ranked number 72 in the 2018 Fortune 500 list of the largest United States corporations by total revenue.
Sound of Music operated nine stores throughout Minnesota by 1978. In 1981, the Roseville, Minnesota, Sound of Music location, at the time the largest and most profitable Sound of Music store, was hit by a tornado. The store's roof was sheared off and showroom destroyed, but the storeroom was left intact. In response, Schulze decided to have a \"Tornado Sale\" of damaged and excess stock in the damaged store's parking lot. He poured the remainder of his marketing budget into advertising the sale, promising \"best buys\" on everything. Sound of Music made more money during the four-day sale than it did in a typical month.
In 1983, with seven stores and $10 million in annual sales, Sound of Music was renamed Best Buy Company, Inc. The company also expanded its product offerings to include home appliances and VCRs, in an attempt to expand beyond its then-core customer base of 15- to 18-year-old males. Later that year, Best Buy opened its first superstore in Burnsville, Minnesota. The Burnsville location featured a high-volume, low-price business model, which was borrowed partially from Schulze's successful Tornado Sale in 1981. In its first year, the Burnsville store out-performed all other Best Buy stores combined.
Best Buy was taken public in 1985, and two years later it debuted on the New York Stock Exchange. In 1988, Best Buy was in a price and location war with Detroit-based appliance chain Highland Superstores, and Schulze attempted to sell the company to Circuit City for US$30 million. Circuit City rejected the offer, claiming they could open a store in Minneapolis and \"blow them away.\"
In 1989, the company introduced a new store concept dubbed \"Concept II\". Concept II replaced dimly lit industrial-style stores with brighter and more fashionably fixtured stores. Stores also began placing all stock on the sales floor rather than in a stock room, had fewer salespersons and provided more self-help product information for its customers. Best Buy also did away with commissioned salespeople. The commission-free sales environment \"created a more relaxed shopping environment free of the high-pressure sales tactics used in other stores,\" but was unpopular with salespersons and suppliers. Upset that their products would no longer be pushed by salespeople, some suppliers such as Maytag, Whirlpool, and Sony stopped selling in Best Buy stores altogether. The suppliers returned after Best Buy's sales and revenue grew following the roll-out of Concept II.
In January 2001, Best Buy acquired Musicland Stores Corporation, a Minnetonka, Minnesota-based retailer that sold home-entertainment products under the Sam Goody, Suncoast Motion Picture Company, Media Play, and OnCue brands. Best Buy purchased the company for $425 million in cash and the assumption of $271 million of Musicland debt. Later that year, Best Buy acquired the British Columbia, Canada-based electronics-chain Future Shop Ltd., marking its entrance to the international marketplace. Under the deal, Future Shop was purchased for about US$377 million and continued to operate as subsidiary independent from Best Buy Canada.
Best Buy stores in the U.S. surpassed the 600-store mark and the company opened its first global-sourcing office in Shanghai in 2003. In June, Best Buy divested itself of Musicland in a deal with Sun Capital Partners under which Sun Capital received all of Musicland's stock and debt. Best Buy launched its \"Reward Zone\" loyalty program in July following an 8-month test of the program in San Diego, California. Also in 2003, Best Buy's corporate offices were consolidated into a single campus in Richfield, Minnesota.
In January 2004, Best Buy hired Virtucom Group to revamp Best Buy's website and handle all of the company's online content. In May, the company launched its \"customer centricity\" program, which segmented its stores according to customer profiles. The program also called for employees to focus on specific customer groups rather than product categories. In October, Best Buy completed rolling out Geek Squad \"precincts\" in every American Best Buy store.
In May 2006, Best Buy acquired a majority interest in Chinese appliance retailer Jiangsu Five Star Appliance for $180 million. At the time of the deal, Jiangsu was the fourth-largest appliance chain in China with 193 stores across eight Chinese provinces. In June, the company opened Geek Squad precincts at Office Depot in Orlando, Florida. The market test was later expanded to Denver.
In January 2007, the first Best Buy-branded store in China officially opened in Shanghai. In March 2007, Best Buy acquired Speakeasy, a Seattle-based broadband VOIP, data, and IT services provider. The acquisition was worth $80 million, and under terms of the deal, Speakeasy began operating as a wholly owned subsidiary of Best Buy. The company's products also became part of Best Buy's For Business program. Best Buy also expanded its Geek Squad market tests in March, opening Geek Squad precincts in FedEx Kinkos stores located in Indianapolis and Charlotte, North Carolina. In October 2007, Best Buy became the first consumer-electronics retailer to exit the analog television market, carrying only digital products that became mandatory in June 2009 by the FCC.
In February 2008, Best Buy opened its first store in San Juan, Puerto Rico. Best Buy's Geek Squad market tests in Office Depot and FedEx Kinkos stores ended by March. Also in March, the company began promoting the Blu-ray optical-disc format over the HD DVD format, a move which ultimately contributed to Toshiba's decision to drop HD DVD. In May, the company agreed to buy 50% of the retail division of The Carphone Warehouse, a London, England-based mobile phone retailer. The deal was worth $2.1 billion.
In July 2008, Best Buy announced that it would start selling musical instruments and related gear in over 80 of its retail stores, making the company the second-largest musical-instrument distributor in the US. Best Buy became the first third-party retail seller of Apple's iPhone in September. Later that month, the company agreed to acquire Napster for $121 million. In December, Best Buy opened its first store in Mexico.
In April 2010, Best Buy opened its first United Kingdom-based Best Buy-branded store in Thurrock. The company eventually opened 11 Best Buy stores in the United Kingdom, all of which were closed in early 2012. In November 2011, Best Buy purchased The Carphone Warehouse's share of Best Buy Mobile for $1.3 billion. Best Buy and The Carphone Warehouse maintained their Best Buy Europe joint venture, which at the time operated 2,500 mobile phone stores throughout Europe.
The company closed all of its Best Buy-branded stores in China by February 2011, when it merged Best Buy China's operations with Jiangsu Five Star, which had become a wholly owned subsidiary of Best Buy in 2009. In December 2011, Best Buy purchased mindSHIFT Technologies, a company that provided IT support for small and medium-sized businesses, for $167 million.
In April 2012, Brian Dunn resigned as Best Buy's CEO during an internal company investigation into allegations of personal misconduct stemming from an inappropriate relationship with a female Best Buy employee. Best Buy named Director George L. Mikan III interim CEO following Dunn's resignation. The internal investigation was released in May 2012 and alleged that Best Buy founder and chairman Richard Schulze knew of Dunn's inappropriate relationship and failed to notify the Best Buy board. Schulze subsequently resigned his chairmanship of the company. Best Buy Director Hatim Tyabji replaced Schulze as Best Buy chairman.
An increasing trend towards online shopping began to erode revenues and profits in the 2010s. A 4% dip in sales for the June 30, 2014, quarter, marked the 10th quarter in a row where Best Buy's sales had declined. The company, in announcing the result, said it was focusing more on digital media in its marketing, moving away from newspaper, magazine, and television advertising.
On March 1, 2018, the company announced that it would shut down its 250 standalone Best Buy Mobile stores in the United States by the end of May, due to low revenue and high costs. The Best Buy Mobile stores were reported to account for 1% of the company's revenue. 59ce067264