Struggling electronics giant Best Buy sank deeper into the mud on Tuesday, when it reported that its second-quarter profit had fallen by 90 percent compared to last year, largely due to weak sales. The blow came a day after the company, which has been losing customers to Amazon and other online rivals, announced that Hubert Joly, chief executive of hospitality company Carlson, would take over as CEO and lead a turnaround effort. Joly is a specialist in fixing troubled companies, but many investors, disappointed by his lack of retail experience, ran scared, sending Best Buy stock tumbling by 10 percent. Is Joly the right man for the job?
Joly can't fix Best Buy: Best Buy's problem is that its sales are in a tailspin, Michael Pachter of Wedbush Securities tells The New York Times. Joly's resume is packed with jobs in the media, technology, and hospitality industries — his "experience in U.S. retail is virtually nonexistent." He might know how to turn around companies that run hotels, but he's the wrong guy "to engineer a turnaround at Best Buy."
"With new chief, Best Buy tries to set its own turnaround"
But his turnaround expertise is what the company needs: The people giving up on Best Buy "even before Joly lands in the corner office are being too hasty," says Lydia Dishman at Forbes. He executed a strategic plan and turned things around in his last job at Carlson, which owns hotels and T.G.I. Friday's restaurants. Joly knows that "customer service is everything" in hospitality, and it might get Best Buy's sales humming again, too. Best Buy needs "a really fresh perspective," and Joly has it.
"Wanted: Time for Best Buy's CEO to wield his turnaround expertise"
Joly is too late to save Best Buy: No matter how good Joly is, he's "too little, too late," says Suzanne McGee at MSN Money. People no longer go to the electronics retailer's 1,000-plus costly showrooms to purchase the hottest new gadgets — they simply go there to check out the plasma TV in person, then go home to buy it cheaper online. Watching Joly try to save Best Buy will be "like watching a slow-moving train wreck."
"Best Buy, take the Schulze deal"
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- After Ferguson: Stop deferring to the cops
- 43 TV shows to watch in 2014
- 7 grammar rules you really should pay attention to
- Ferguson riots were terrible — but this racist reaction was worse
- How to be the most productive person in your office — and still get home by 5:30 p.m.
- Hey, scolds: Stop telling us to enjoy a healthy Thanksgiving
- The hilarious hypocrisy of Republicans complaining about the imperial presidency
- Is it now OK to have sex with animals?
- Don't blame Chuck Hagel: Obama's foreign policy has been a disaster from end to end
- Don't argue about politics this Thanksgiving. Just don't.
Subscribe to the Week