Best Buy warns of falling demand

October sales at Best Buy were down over seven per cent

In more bad news for the technology sector Best Buy, the biggest electronics retailer in the US, lowered its revenue forecast for the fourth quarter.

The chain said that October sales were down over seven per cent, and that it had lowered its forecast for 2009 sales in accordance. Overall sales for the fourth quarter were down four per cent.

"Since mid-September, rapid, seismic changes in consumer behaviour have created the most difficult climate we have ever seen," said Brad Anderson, vice chairman and chief executive at Best Buy.

"Best Buy simply cannot adjust fast enough to maintain our earnings momentum for this year. We are beginning to adjust our cost structure to restore earnings momentum and still gain market share.

"We firmly believe that our strategy of customer centricity is of great value in driving our performance versus the industry, and that is the strategy we plan to pursue to continue to strengthen our position in the marketplace."

The news follows several similar announcements in the IT industry. Circuit City, the second biggest electronics retailer in the US, filed for bankruptcy protection earlier in the week, and Intel made a surprise announcement yesterday that it was wiping $1bn (£673m) off its predicted fourth-quarter revenues in light of falling sales.