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Online sales

Best Buy says online sales in U.S. surged 242% in second quarter, but shares slide as gains may be short-lived – CNBC

People wearing masks walk past a large face mask sign in front of a Best Buy near Columbus Circle that as the city enters Phase 4 of re-opening following restrictions imposed to slow the spread of coronavirus in New York City.

Alexi Rosenfeld | Getty Images

Best Buy on Tuesday reported strong second-quarter sales growth, helped by its biggest quarterly increase in online sales ever, as customers bought computers, kitchen appliances and other tech to help them work, cook and attend school at home during the coronavirus pandemic.

Online sales shot up 242% in the U.S. compared with the prior year, as the website drew higher traffic and more people converted from browsing to buying.

Sales at stores open at least a year grew by 5.8%, higher than the 2.3% that Wall Street expected. That same-store sales growth was its highest in two years, even though its stores were open by appointment only for the first six weeks of the quarter.

However, shares of the company were down more than 6% Tuesday morning, as the company declined to provide an outlook for its future results.

Nearly every merchandise category grew during the second quarter, with computing, tablets and appliances fueling sales. Receipts were down for mobile phones and flat with home theater.

“Everything that people are doing right now is on the back of technology in their home, and it completely underscores our purpose and our philosophy,” CEO Corie Barry said on an earnings conference call. She said consumers are enriching their lives through technology. “We’re seeing it across basically every aspect of what we’re selling in our stores.”

Here’s what the company did in the fiscal second quarter ended Aug. 1:

  • Earnings per share: $1.71, adjusted, vs. $1.08 expected by Refinitiv’s consensus estimates
  • Revenue: $9.91 billion vs. $9.71 billion expected by Refinitiv estimates
  • Same-store sales growth: 5.8% vs. 2.3% expected by FactSet

Chief Financial Officer Matt Bilunas said in a news release he expected to see year-over-year sales growth in the third quarter but warned that growth wasn’t likely to continue at the same pace. He also cautioned that the retailer will have higher expenses as its stores are fully reopened.

“Overall, as we plan for the back half of the year, we continue to weigh many factors, including potential future government stimulus actions, the current shift in personal consumption expenditures from areas like travel and dining out, the possible depth and duration of the pandemic, the risk of higher unemployment over time, and the availability of inventory to match customer demand,” Bilunas said.

Inventory was limited in a number of categories because of higher-than-expected demand. Barry said that cut into sales growth.

Best Buy reported second-quarter net income of $432 million, or $1.65 per share, a significant increase from $238 million, or 89 cents per share, a year earlier.

Excluding items, it earned $1.71 per share, higher than the $1.08 per share expected by analysts surveyed by Refinitiv.

Revenue was $9.91 billion, up from $9.54 billion a year earlier, and higher than analysts expected.

Best Buy switched to a curbside-pickup-only model early in the pandemic, even though it could have kept stores open as an essential retailer. In early May, it began allowing customers to shop at stores by appointment only

Starting June 22, nearly all of its stores were open to shopping without an appointment and it resumed at-home consultations. It also brought back about half of the 51,000 workers furloughed in April.

With shoppers browsing in stores again, Barry said the retailer has seen positive trends. Sales of large appliances and home theater have picked up. She said in a news release that sales growth across the business was about 16% in the last seven weeks of the second quarter and in the first three weeks of the third quarter, sales were up about 20%.

Read the complete press release here.

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Online petition

Online petition calls on Trader Joe’s to change its ‘racist packaging’ – CNN

(CNN)More than 1,700 people have signed a petition urging Trader Joe’s to change the labeling of some of its international food products, calling the grocery chain’s branding “racist.”

“The grocery chain labels some of its ethnic foods with modifications of “Joe” that belies a narrative of exoticism that perpetuates harmful stereotypes,” the petition, which a California high school senior launched two weeks ago, reads.
It cites “Trader Ming’s,” the grocery chain’s label for its Chinese products, “Arabian Joe,” for its Middle Eastern products, “Trader José,” for its Mexican products, and a handful of others as examples.
“The Trader Joe’s branding is racist because it exoticizes other cultures – it presents ‘Joe’ as the default “normal” and the other characters falling outside of it,” the petition says.
The grocery store chain, which first opened in Pasadena, California, in 1967, said it has already “been in the process of updating order labels, and replacing any variations with the name Trader Joe’s.”
“While this approach to product naming may have been rooted in a lighthearted attempt at inclusiveness, we recognize that it may now have the opposite effect — one that is contrary to the welcoming, rewarding customer experience we strive to create every day,” Kenya Friend-Daniel, a spokeswoman for Trader Joe’s, said in a statement.
“Packaging for a number of the products has already been changed, but there’s a small number of products in which the packaging is still going through the process,” Friend-Daniel added.
Trader Joe’s is the latest in a line of companies to rebrand its products following the widespread protests over racial inequality sparked by the death of George Floyd.
Last month, Quaker Oats announced that it was retiring the 130-year-old Aunt Jemima brand and logo, acknowledging that it was based on a racial stereotype. Uncle Ben’s and Mrs. Butterworth’s quickly followed.

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Online servers

GTA Online, Red Dead Online servers go offline to honor George Floyd – Polygon

As protests against racial injustice and police brutality have spread across the United States following the death of George Floyd, many game developers and publishers have made public statements of support. Rockstar Games, 2K Games, and their parent company Take-Two Interactive announced addition action on Thursday, saying that they will shut down the servers for games such as Grand Theft Auto Online, Red Dead Online, and NBA 2K for two hours on Thursday afternoon “to honor the legacy of George Floyd.”

Floyd, a black man, died in police custody on May 25 in Minneapolis after being pinned to the ground by multiple officers, one of whom pressed his knee into Floyd’s neck for nearly nine minutes. Two autopsies have ruled Floyd’s death a homicide. Outrage over the incident has spilled into streets of all 50 states and around the world, leading to calls to reform the criminal justice system and more.

Black Lives Matter. To honor the legacy of George Floyd, today, 6/4/20, from 2:00-4:00 p.m. ET, we will be shutting down access to our online games, Grand Theft Auto Online and Red Dead Online.

— Rockstar Games (@RockstarGames) June 4, 2020

“Black Lives Matter,” said Rockstar Games on its official Twitter account. “To honor the legacy of George Floyd, today, 6/4/20, from 2:00-4:00 p.m. ET, we will be shutting down access to our online games, Grand Theft Auto Online and Red Dead Online.”

“Following the memorial,” Rockstar added in a follow-up tweet, “we hope you will join us in further honoring the many victims of America’s racial injustices by supporting their families, black-owned businesses, those marching on the streets, and coalitions.”

Rockstar ended its thread with a link to Charity Navigator, a nonprofit organization that maintains a vetted list of civil rights-focused charities.

In addition to Rockstar’s titles, additional games from 2K Games and Social Point will go offline as well from 2-4 p.m. EDT on Thursday, Take-Two Interactive said in a statement to Polygon. The list includes NBA 2K, Dragon City, and Monster Legend. Private Division, whose portfolio includes The Outer Worlds and Kerbal Space Program, will also “suspend” its activities during the window.

George Floyd’s memory will serve as a reminder that racism and the violence it incites cannot be tolerated,” Take-Two Interactive said. “We are committed to supporting efforts to eradicate racial injustice and stand in solidarity with the Black community against this systemic issue that causes conflict and division in our society.”

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Online Ticketing

Online Ticketing, Social Distancing, and Sanitizer: A Night in the Life of a Drive-In During COVID-19 – Variety

Drive-in movie theaters have been something of a salvation during the coronavirus pandemic. As one of the few entertainment joints that are safe to visit outside of the house, they’ve enjoyed a huge boost in popularity. But don’t call it a comeback, says Transit Drive-In Theater owner Rick Cohen.

Outdoor moviegoing, once seen as a relic from another century, has become the go-to spot for those itching to social distance from their couch. That’s left Cohen, whose venue is in upstate New York, regularly fielding calls from local and national reporters.

“I’m juggling all this media — they’re all over the drive-in resurgence,” Cohen tells Variety days after his theater opened for the season. “Drive-ins aren’t having a resurgence. Drive-ins have been doing well. It’s a resurgence of the media remembering that drive-ins still exist.”

That may be true, but there’s no denying that drive-in theaters are uniquely suited to thrive while most multiplexes stay closed due to the global heath crisis. And though there aren’t many left in the U.S. — about 300 drive-ins still exist, compared to over 5,400 brick-and-mortar theaters — they’ve been rare bright spots for the exhibition industry. The bulk of those who own and operate cinemas are struggling to survive, having been left without a way to make money while theaters are shuttered.

Cohen considers himself one of the lucky ones.

Transit Drive-In, located about 30 minutes north of Buffalo in Lockport, is seasonal (probably a good thing considering western New York’s arctic chill during much of the winter). It doesn’t open until summer when it’s finally warm enough to spend time outdoors. Cohen had been planning to dust off projectors and set up shop in the middle of March, just in time for “A Quiet Place Part II,” a sequel to John Krasinski’s horror hit. When Paramount pulled it from release, Cohen delayed the reopening — first voluntarily before it became mandatory two weeks later.

Last week, New York Gov. Andrew Cuomo gave drive-ins in his state permission to sell tickets again and Transit Drive-In was able to open just in time for Memorial Day weekend. For many cinemas, Cohen’s included, the end May through Labor Day in September remains one of busiest times of year.

But for the first time in the 33 years that Cohen has been running herd, things at Transit Drive-In look a little different.

For one, he’s capped capacity in the parking lot at 50% to allow more space between vehicles. That’s resulted in roughly 640 spots up for grabs nightly across five screens. There’s an average of 2.3 adults per car, but even with admission running at $10 a pop, Cohen’s math suggests there’s “potential money left on the table.”

“We routinely sell out in the summertime when there’s a big new movie and the weather is good,” he said.

Also for the first time, tickets are only being sold online. That safety measure limits the handling of cash, while ensuring spots aren’t oversold. “I’m going to have to pay higher processing fees because I can’t take cash,” he said. “But it’s better than being closed.”

There are more employees working than usual to assist with new protocol, meaning Cohen’s payroll will be higher with less revenue coming in. Still, he isn’t worried about restrictive sales or making ends meet. “Opening a drive-in, for me, wasn’t about how much money I can make it. It was about serving the community safely,” he said.

Here’s what a typical night now looks like:

5:50 p.m. — Arrive at the Transit Drive-In

Cohen’s day begins well before he first shows up to work, often answering emails and sifting through voicemails from patrons before he pivots to run other errands. Even though tapes don’t start rolling until 9 p.m., he gets in just before the clock strikes 6 to greet the eager customers hoping to get the best spot in the lot.

“There’s only so many spaces in the front,” he said. “Before this, they would throw a Frisbee around or take the dog out. A drive-in is part camping, part movie theater and part tailgate party. So now, it’s a little less of each of those, but still a lot of fun.”

6 p.m. — Start to scan tickets

There are pros and cons to the online-only system for buying tickets, though overall they’ve found it has made arrivals more efficient. Employees can methodically scan tickets before sending customers through.

But the new process is not without its hiccups.

“We noticed right away that people who buy their tickets on three days notice either make mistakes or change their minds,” he grumbles. “It’s really aggravating. We had to go into extensive detail on our website ticketing purchase page. Apparently ‘all transactions are final, no exceptions’ is not clear enough.”

6 p.m. – 9 p.m. — Selling concessions and keeping restrooms clean 

No moviegoing experience would be complete without a large tub of popcorn and an ice cold soda. Plus, concession stand sales are a major source of revenue for theaters. Plexiglass has been installed at the snack bar, where each cashier is equipped with their own bottle of hand sanitizer. They’re also donning face masks and gloves. Only one register is permitted to take cash. It requires two employees, one to handle the food and one to handle the transactions. A second register accept credit cards and a third is reserved for advance orders handled by phone.

“I ordered hands-free sanitizer stations in March. I was lucky to get them in May,” Cohen said. “I had to beg my supplier for them. The producers can barely keep up. The fact that I got my hands on three of them… someone up there was looking out for me. I got lucky.”

There are two entrances to the snack bar, where two more staffers are monitoring the area to ensure there aren’t more than 10 people inside at once.

“That’s another team of staff members who wouldn’t be on the schedule that we’re providing for safety,” he said. “People aren’t going to police that themselves, you need someone to allow people in as room becomes available.”

Restrooms are also a concern, Cohen recognizes, so attendants sanitize each of the 16 stalls after every use. That requires three extra people — one surveying lines outside the bathroom, a female to disinfect the ladies’ room and a male to clean the men’s room.

“We want every person who uses our restroom to feel safe. The only way to do that is to literally disinfect the stall after every use,” he said.

9 p.m. Roll the tapes

Most drive-in theaters entice families with an evening of double-bills. But in an effort to reduce the foot traffic in restrooms and concession stands, Transit Drive-in is only showing single features.

“We don’t want to encourage people to stay for two movies where there’s a crush to use the restroom in between,” Cohen said. “That’s a sacrifice our customers are making. It’s not something we prefer to do because one of the advantages of attending drive-ins has been double features.”

Since studios are releasing new movies less frequently, recent films like the animated “Trolls World Tour” and thriller “The Invisible Man” have been mainstays on the marquee. “People love scary movies at drive-ins. Horror and suspense do well,” he said. “And family pictures are very popular.”

11:30 p.m. Usher the last car out and clean the premises 

Typically, showtimes are staggered so there isn’t a mad dash to leave. They’re still experimenting with what times work best. But for the most part, that aspect has been smooth sailing.

“Without intermissions, you don’t have concession-stand congestion,” he said. “When the movie is over, everyone leaves.”

When the final car exits the grounds, Cohen sends his crew to clean any garbage that’s been left behind.

“That’s fun,” he jokes, “collecting covid-infected trash from the parking lot. We’re wearing PPE gloves and just tossing in garbage bag. As long as you’re conscious of what you’re doing and have protective gear, you don’t have to be wearing a hazmat suit.”

12 a.m. Send the crew home

Working at a drive-in often means late nights, but shifts have been ending slightly earlier in the age of coronavirus. Intermission is normally around midnight, which signals a blitz to buy popcorn, hot dogs and fries before the second film starts playing. On an average day, they’d leave around 2 a.m. — sometimes after 2:30 if it’s a lengthy movie. (“It should be a law,” he laments, “that all theatrical movies should be two hours or less.”)

“What’s weird is I feel more tired after a single-feature performance, getting out before midnight, than I did before when we were showing two movies,” Cohen said. “It’s a lot more stressful. You feel a lot more responsibility — the burden of people’s health and safety.”

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