Best Buy has reported a better-than-expected first-quarter earnings despite challenging circumstances. The electronics retailer posted a net income of $202 million, or $0.95 per share, down from $246 million, or $1.13 per share, a year ago. Adjusted earnings per share were $1.15. While sales saw a slight dip to $8.77 billion from $8.85 billion, comparable sales decreased by 0.7%, as noted in a report by AP News.

In a significant move, Best Buy revised its annual profit and sales forecasts downwards. The company now projects adjusted earnings per share in the range of $6.15 to $6.30, compared to an earlier estimate of $6.20 to $6.60. The sales forecast was similarly reduced, with expected sales between $41.1 billion and $41.9 billion, down from the previous range of $41.4 billion to $42.2 billion.

The downward revision comes amid rising costs due to U.S. tariffs on goods, particularly imported electronics from China and Mexico, which make up significant portions of its imports, according to Reuters. These tariffs, along with higher borrowing costs, have influenced consumer spending and affected the retailer's financial outlook. The broader retail sector faces similar challenges, with other major players like Walmart and Macy's also adjusting their forecasts in light of economic uncertainties.