Best Buy Co. Inc. (NYSE: BBY) reported fourth-quarter and full-year fiscal 2014 results before markets opened Thursday. The big-box retailer of electronics gear reported adjusted diluted earnings per share (EPS) of $1.24 and $14.47 billion in revenues. In the same period a year ago, Best Buy reported EPS of $1.47 on revenue of $14.92 billion. Fourth-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $1.01 and $14.66 billion in revenue.

For the full year, EPS totaled $2.07, compared with $2.54 in 2012. Revenue in 2014 came in at $42.1 billion, compared with 43.91 billion in 2013. Consensus estimates called for EPS of $1.84 on revenues of $42.71 billion.

U.S. same-store sales were down 1.2% year-over-year and international same-store sales fell 1.7%. Online sales in the U.S. rose 25.8%. For the 2014 fiscal year, U.S. same-store sales fell 0.4% and international sales fell 3.1%. U.S. online sales rose 19.8% in the year.

The company’s CEO said:

As we said in our holiday sales release, the fourth quarter was an environment of declining retail traffic, intense promotion, fewer holiday shopping days and severe weather. In the face of these unusual circumstances, our strategy to be price competitive and provide an improved customer experience resulted in market share gains in a weaker-than-expected consumer electronics market.

And it will not improve quickly. The company’s CFO noted:

From a revenue perspective, in light of overall economic concerns, we are assuming that the [retail] industry declines in the consumer electronics category that we saw in the fourth quarter will continue. As a result, it is reasonable to expect that total company revenue and comparable store sales will remain slightly negative — similar to Q4 FY14 — in the first half of the year.

Best Buy expects operating income to be down by 70 to 90 basis points in the first quarter, 70 to 100 basis points in the second quarter and 30 to 60 basis points in the third quarter. The company did not offer any other guidance, but the consensus estimates for the first quarter of the 2015 fiscal year call for EPS of $0.34 on revenues of $9.30 billion. The full-year estimates call for EPS of $2.20 on revenues of $42.61 billion.

These results look good and will please investors, but Best Buy is clearing a very low bar. The business is shrinking, and if it eventually turns around, the resulting company will not look much like the old one. We noted Wednesday that the company is reportedly firing some 2,000 managers. There was no reference to that report in the press release, but some questions about Best Buy’s restructuring should surface in the conference call.

Shares were up about 7.5% in premarket trading this morning, at $25.82 in a 52-week range of $15.75 to $44.66. Thomson Reuters had a consensus analyst price target of around $33.60 before the results were announced. That target has fallen from $45 in the past three months.

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