Best Buy (NYSE: BBY | BBY Price Prediction) announced that Jason Bonfig, the company’s Chief Customer, Product, and Fulfillment Officer, would succeed Corie Barry as the next Chief Executive Officer at Best Buy.
Berry became Best Buy’s CEO in 2019. She has done a great deal to weaken the company. Its stock is down 46% over the last five years, while the S&P 500 has jumped 71%. Even deeply wounded retailer Target (NYSE: TGT) has a stock that is down only 36% over the same period.
Among the most astonishing aspects of the announcement is that Bonfig was on Barry’s team as Best Buy’s shares lost much of their value, as reflected in their performance. On April 13, Goldman Sachs analyst Kate McShane double-downgraded Best Buy to “Sell” from “Buy”. It cut its price target to $59 from $76. The stock trades at $63.
A great deal of the blame for Best Buy’s performance and the stunning appointment of a member of the Best Buy team as CEO belongs to David Kenny, the Chair of the Board. Kenney has been a director since 2013, so he has been on the board throughout Barry’s tenure. There must have been candidates who had success as CEOs or senior management at other retailers.
The strongest evidence of the drop in Best Buy’s shares and the primary case for poor management is that its revenue in fiscal year 2022 was $51.9 billion. It was $46.4 billion in fiscal year 2023, $43.6 billion in fiscal year 2024, $41.5 in fiscal year 2025, and $41.8 billion in fiscal year 2026.
One could argue that profits at Best Buy have been fine and that earnings have not been terrible. However, adroit expense cuts and share buybacks have helped. However, neither of these is a sign of good management. Bonfig doesn’t belong in the job. He has been the lieutenant to a failed CEO. The board should have known that
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