Best Buy(BBY) - 2025 Q4 - Annual Report

Financial Performance - The International segment generated approximately 8% of the consolidated revenue during fiscal 2025 [110]. - Approximately 25% of the fiscal 2025 Domestic segment revenue was transacted using the company's branded cards [116]. - Profit-sharing revenue from the credit card arrangement approximated 1.1% of Domestic segment revenue in fiscal 2025 [116]. - As of February 1, 2025, the company had $1.9 billion of cash, cash equivalents, and restricted cash [248]. - A 50-basis point increase in short-term interest rates would have led to an estimated$7 million increase in net interest income [248]. - Foreign currency exchange rate fluctuations had an unfavorable impact on revenue of approximately $85 million during fiscal 2025 [250]. Risk Management - The company faces risks related to the failure to accurately predict customer demand, which could impact revenue and profitability [88]. - Effective management of the real estate portfolio is critical to the company's omnichannel strategy, with potential negative impacts on profitability if not managed properly [89]. - Supply chain interruptions could adversely affect the company's business, particularly with the increasing demand for online purchases and fast delivery [90]. - The company relies on third-party vendors for various operations, and any disruption in these relationships could impact revenues and cost structure [91]. - The company is exposed to product-related risks, including potential legal issues and damage to reputation if products fail to meet safety standards [92]. - The integration of AI into operations increases cybersecurity and privacy risks, potentially leading to unauthorized access to sensitive data [103]. - The company faces heightened risks of cybersecurity attacks, which could disrupt operations and adversely impact revenue [102]. - Regulatory compliance risks are increasing, with potential fines and additional operating costs associated with new laws and regulations [108]. - The company may incur increasing costs related to information security and privacy, impacting overall business operations [106]. - The company faces risks related to compliance with labor and employment laws, which are frequently modified [111]. - Changes in credit ratings may limit access to capital and materially increase borrowing costs [119]. Corporate Governance - The company is subject to evolving corporate governance and public disclosure regulations, increasing general and administrative expenses [109]. - The company is highly dependent on cash flows and net earnings generated during the fiscal fourth quarter, which includes the holiday shopping season [115].