Best Buy Co., Inc. (BBY): What This Means For Investors

Page 2 of 2

Amazon.com, Inc. (NASDAQ:AMZN) is upping its competition against Netflix, Inc. (NASDAQ:NFLX). Netflix ran in to a lot of issues with customers and investors when it changed it subscription models and separated streaming and mail delivery videos. The company recently reported its first quarter earnings. It added roughly 3 million new subscribers in the quarter bringing total subscribers to 26 million worldwide. New subscribers are expected to rise this year and bring double-digit revenue growth in 2013.

As cable television costs rise, may consumers are switching to more affordable options like Netflix, Inc. (NASDAQ:NFLX) and Amazon prime. Netflix has been very successful at making the delivery of its content very simple and straightforward. It allows content to be delivered by various set-top devices. This is why so many customers stay with Netflix, Inc. (NASDAQ:NFLX).

Final thoughts

Amazon is trying to make a run for this market with its new hardware development. Its streaming service Amazon Prime has roughly 10 million subscribers, so it has a long way to go. As it is attempting to further penetrate this market further, it may leave an opportunity for Best Buy to take e-commerce sales away.

Best Buy Co., Inc. (NYSE:BBY) has less to focus on after its departure from Europe. Its other international markets aren’t performing very well so cash flow may suffer this year. It is now matching Amazon.com, Inc. (NASDAQ:AMZN) pAmazon.com, Inc. (NASDAQ:AMZN)rices and will benefit from online sales tax taking away from Amazon’s competitive edge. The battle is uphill and Best Buy has a lot to accomplish to ensure future success. Keep an eye on international profits this year to see how the company is handling its other markets.

The article This Company Is Exiting, Not Admitting Defeat originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Page 2 of 2