It was quite the shock when JB Hi-Fi announced just a 4.3% growth in revenue and a 3.7% drop in net profit.
👉 Background: JB Hi-Fi is probably the place where you bought your first So Fresh album. Since 1974 it has grown to 300 stores, across JB Hi Fi and the Good Guys... which it acquired back in 2016 for $870 million.
👉 What happened: Over the past few years, JB Hi Fi has been able to grow impressively year on year thanks to its handwritten signs, warehouse-y feel and passionate tech staff. So, it was quite the shock when JB Hi Fi announced just a 4.3% growth in revenue and a 3.7% drop in net profit.
👉 What else: In particular, white goods like washing machines and fridges saw The Good Guys' sales drop 12% in July. But, these results still beat expectations against the current retail backdrop.
💡When evaluating the performance of a company, it's critical not to look at results in isolation. By comparing a company's results with those of its competitors and the broader industry, we get a clearer picture of its relative performance.
💡For instance, JB Hi Fi reported a small revenue increase, but the entire industry saw sales drop 1.7% on average. So when you look at it that way, JB Hi Fi's performance can be considered commendable.
💡Despite showing results that aren't as good as previous results, it does show JB Hi Fi's strength and resilience... particularly, when the majority of the retail industry is in pain right now.
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