Best Buy

Founding and the Tornado Sale

Best Buy originated as Sound of Music, an audio specialty store founded on August 22, 1966, in St. Paul, Minnesota by Richard M. Schulze and James Wheeler. Schulze used his personal savings and a second mortgage on his home to finance the first location. The business grew through acquisitions, purchasing Kencraft Hi-Fi Company and Bergo Company in 1967. By its first year, Sound of Music earned $1 million in revenue with approximately $58,000 in profit. Schulze bought out his business partner in 1969 when the chain had three stores, and it expanded to nine locations throughout Minnesota by 1978.

A defining event for the company occurred in 1981 when a tornado struck the Roseville, Minnesota store, which was then the largest and most profitable location. The tornado sheared off the roof and destroyed the showroom, though the storeroom remained intact. In response, Schulze organized a Tornado Sale in the store's parking lot, selling damaged and excess stock. He invested his remaining marketing budget into advertising the event, promising best buys on everything. The four-day sale generated more revenue than the company typically earned in an entire month, demonstrating the effectiveness of a high-volume, low-price promotional model.

Rebranding to Best Buy and National Growth

In 1983, with seven stores and $10 million in annual sales, Sound of Music was renamed Best Buy Company, Inc. The rebranding coincided with a strategic expansion of its product line beyond stereo equipment to include home appliances and VCRs, aiming to attract customers beyond its core demographic of teenage males. That same year, the company opened its first superstore in Burnsville, Minnesota, which explicitly adopted the high-volume, low-price business model proven by the Tornado Sale. The Burnsville store's performance in its first year surpassed the combined sales of all other Best Buy locations. In 1988, Schulze attempted to sell Best Buy to its larger rival Circuit City for US$30 million, but Circuit City rejected the offer. Also in 1988, Best Buy introduced its Concept II store design, which fundamentally changed the retail experience by eliminating commissioned salespeople, using brighter lighting, placing all stock on the sales floor, and providing more self-help product information. This move initially caused suppliers like Maytag, Whirlpool, and Sony to withdraw their products, but they returned as sales grew under the new format. Best Buy reached $1 billion in annual revenue in 1992, the same year Highland Superstores filed for bankruptcy.

Store Concept Evolution and Early Acquisitions

Concept III debuted in 1994 in markets like Los Angeles and Washington, D.C. These stores were larger and featured expanded product offerings, demonstration areas for home theatre and video games, and interactive Answer Center touchscreen kiosks for product information. The Concept IV format launched in 1998 with the company's expansion into New England. These stores had an open layout organized by product category, cash registers distributed throughout the space, and dedicated large areas for home theatre demonstrations, though they were slightly smaller than Concept III stores. The company also expanded through acquisitions during this period. In December 2000, Best Buy acquired Magnolia Hi-Fi, Inc., a high-end audio-video retailer with locations in California, Washington, and Oregon. In January 2001, it purchased Musicland Stores Corporation for $425 million in cash plus assumed debt, gaining the Sam Goody, Suncoast, and Media Play brands. A more significant move for international expansion came later in 2001 when Best Buy acquired the Canadian electronics chain Future Shop Ltd. for about US$377 million. Future Shop continued to operate as a separate subsidiary, marking Best Buy's first entry into the international marketplace.

Canadian Market Entry and Service Brand Development

Following the acquisition of Future Shop, Best Buy established its own branded presence in Canada. The first Canadian Best Buy store opened in Mississauga, Ontario, in September 2002. For over a decade, the two brands operated in parallel, often with stores located close to one another. This dual-brand strategy concluded abruptly on March 28, 2015, when Best Buy announced the complete shutdown of the Future Shop chain. This consolidation unified the company's Canadian retail footprint under a single banner.

A critical component of Best Buy's service strategy was the acquisition of Geek Squad in October 2002. At the time of purchase, Geek Squad was a 24-hour residential computer repair business with offices in four US cities. Best Buy rapidly integrated the service, rolling out Geek Squad precincts to every US store by October 2004. In Canada, Geek Squad services are offered through in-store precincts and the geeksquad.ca website, providing technical support, repair, and warranty services. The company also launched the Reward Zone customer loyalty program in the US in July 2003 after an eight-month test in San Diego.

International Ventures and Leadership Changes

Best Buy pursued several international ventures in the 2000s with mixed results. It acquired a majority stake in Chinese appliance retailer Jiangsu Five Star Appliance for $180 million in 2006 and opened its first Best Buy-branded store in Shanghai in January 2007. However, by February 2011, it closed all its branded stores in China, merging operations with the wholly owned Five Star subsidiary. In Europe, a 2008 deal gave Best Buy a 50 percent stake in the retail division of The Carphone Warehouse for $2.1 billion, leading to the launch of Best Buy Mobile and the opening of 11 Best Buy stores in the United Kingdom starting in 2010. These UK stores all closed by early 2012, and Best Buy fully exited the European consumer electronics market in April 2013 by selling its stake back to The Carphone Warehouse for approximately $775 million.

The company experienced significant leadership turmoil in 2012. CEO Brian Dunn resigned in April during an internal investigation into an inappropriate relationship with a female employee. A subsequent investigation in May found that founder Richard Schulze had known about the relationship and failed to inform the board, leading to Schulze's resignation as chairman. Hubert Joly, former CEO of Carlson, was appointed CEO in September 2012 to lead a turnaround. Joly's strategy included initiatives like matching competitors' prices, improving online delivery times, creating branded store within a store sections for Apple and Samsung, and enhancing employee training. Joly was succeeded as CEO by the company's CFO, Corie Barry, in June 2019. In 2026, the company announced that Jason Bonfig would replace Barry as CEO in October of that year.

Recent Business Strategy and Financial Performance

In response to changing consumer habits, Best Buy has made several strategic shifts in the 2020s. On October 13, 2023, the company announced it would phase out sales of DVDs and Blu-ray discs in early 2024, citing the dominance of streaming video services. It has also focused on expanding its e-commerce platform, announcing in January 2025 plans to relaunch an online marketplace for third-party sellers by summer 2025 in partnership with the software provider Mirakl. This follows a previous marketplace that operated from 2011 to 2016. Despite a sales increase in computer equipment during the COVID-19 pandemic, Best Buy laid off over 5,000 employees in early 2021 and converted many others to part-time status.

Financially, the company reported annual revenue of $41.69 billion for its 2026 fiscal year, with a net income of $1.07 billion. For the quarter ended August 1, 2026, revenue increased 3.6 percent year over year to $9.78 billion, while net income rose to $315 million. Comparable sales grew 4.1 percent for that quarter, and the company raised its revenue guidance for fiscal 2027 to a range of $42.3 billion to $42.8 billion. The company's effective tax rate for the quarter ended May 2, 2026, was 26.9 percent, compared to 8.6 percent the previous year. Best Buy's stock price was $86.99 as of 2026, with a market capitalization of $18.2 billion.

Canadian Operations and the Best Buy Express Partnership

Best Buy's Canadian division operates the Best Buy and Best Buy Mobile brands, along with Geek Squad services. The company promotes a Low Price Guarantee on its Canadian website and in stores. As of October 2016, the company operated 135 Best Buy and 53 standalone Best Buy Mobile stores in Canada. In recent years, the company has adjusted its physical media offerings, significantly reducing the space devoted to selling CDs in 2018 due to the popularity of streaming services. A major development for Best Buy's Canadian footprint was announced on January 18, 2024.

BCE Inc. reached an agreement with Best Buy Canada to rebrand selected locations of its competing chain, The Source, as Best Buy Express. The Source was originally the Canadian franchise of RadioShack, later owned by Circuit City and then acquired by Bell. Under the licensing deal, these converted stores receive inventory from Best Buy and integrate with its e-commerce operations but continue to be owned and operated by BCE. They exclusively offer wireless services from Bell Canada and its subsidiaries. The first Best Buy Express location opened in Surrey, British Columbia, in June 2024. A total of 167 The Source stores were converted to the new branding, with the remaining locations closed permanently.

Product Offerings and Corporate Structure

Best Buy sells a broad assortment of consumer electronics, home appliances, software, video games, mobile phones, and digital cameras in a noncommissioned sales environment. Its private-label brand, Insignia, offers a range of electronics and accessories. The company's Geek Squad subsidiary provides computer repair, technical support, and various protection plans. Best Buy also maintains an online community forum where customers can discuss products and get answers from experts. The building exteriors of its large-format stores are typically light brown with a distinctive blue entrance design.

Corporate employees at the Richfield, Minnesota headquarters worked under a results only work environment from 2005 until March 2013, when CEO Hubert Joly ended the flexible work style. The company's stock is traded on the New York Stock Exchange under the symbol BBY. As of 2026, the stock price was $86.99, with a market capitalization of $18.2 billion and approximately 210 million shares outstanding. Best Buy was added to the Standard & Poor's S&P 500 index in 1999, reflecting its stature as a major US corporation. The company also operates the Pacific Sales and Magnolia Design Center brands for high-end appliances and home theatre solutions.

Questions about Best Buy

When did Best Buy first come to Canada?

Best Buy first entered the Canadian market in 2001 when it acquired the British Columbia based electronics chain Future Shop Ltd. This acquisition marked the company's entrance to the international marketplace. The first Canadian retail store operating under the Best Buy brand name opened in Mississauga, Ontario, in September 2002. For many years, Best Buy and Future Shop operated as separate chains in Canada. Best Buy eventually closed the Future Shop chain in Canada in March 2015, converting 65 of its locations into Best Buy stores.

What happened to Future Shop in Canada?

Best Buy announced the shutdown of the entire Future Shop chain in Canada on March 28, 2015. Of the 131 Future Shop locations at the time, 65 were converted into Best Buy stores. The remaining locations, primarily those situated too close to an existing Best Buy store, were permanently closed. This consolidation ended the dual-brand strategy and unified the company's Canadian retail presence under the Best Buy banner.

What is Geek Squad and is it available in Canada?

Geek Squad is Best Buy's technical support and service division, originally a 24 hour residential computer repair business. Best Buy acquired the Minneapolis based Geek Squad in October 2002. The company completed rolling out Geek Squad precincts in every American Best Buy store in October 2004. Geek Squad services are available in Canada through precincts located inside Best Buy stores. The company operates the Best Buy Mobile and Insignia brands in North America, which includes Canada.

What are Best Buy Express stores?

Best Buy Express is a new store format in Canada launched through a partnership with BCE Inc. announced in January 2024. Select locations of BCE's The Source chain are being rebranded as Best Buy Express. These stores are owned and operated by BCE under a license from Best Buy, feature inventory supplied by Best Buy, and integrate with its e-commerce platform. They exclusively offer wireless services from Bell Canada and its subsidiaries. The first location opened in Surrey, British Columbia, in June 2024.

Who is the CEO of Best Buy?

As of late 2026, a leadership transition is underway. Corie Barry served as CEO from June 2019 until her scheduled replacement by Jason Bonfig in October 2026. Barry had succeeded Hubert Joly, who became executive chairman. The announcement of Bonfig's appointment was made in 2026, with an emphasis on his industry experience as the company addresses its next phase of operations.

Does Best Buy still sell DVDs and Blu-rays?

No, Best Buy announced on October 13, 2023, that it would phase out the sale of home video on physical media in early 2024. The company cited changes in the market due to the prevalence of streaming video on demand services as the reason for this decision. This move follows a longer term trend, as Best Buy had previously reduced the amount of store space devoted to selling physical music in July 2018. The company had also become the first consumer electronics retailer to exit the analog television market in October 2007.

Sources: Wikipedia and current public reporting, checked by the Yadude Books desk. Last updated 2026-10-20.