Sign up below to be added to our mailing list for the latest news updates, access to exclusive contents, and more!
In 2006, Best Buy began opening small “Best Buy Mobile” stores across the country, typically in shopping malls. A year later, the iPhone made its debut.
But now the Richfield, Minnesota-based retailer is closing all 257 of its remaining mobile stores. A memo was sent to employees Feb. 28, and the company notified the federal Securities and Exchange Commission.
The company will close all of the mobile stores by May 31.
The company’s CEO Hubert Joly said on an earnings call that the stores were closing due to “changing economics in the mobile industry,” Dayton Daily News reported.
“Back then the mobile phone business was in a period of rapid growth and margins were high,” Joly said, according to the Dayton Daily News. “Fast forward to 2018 and the mobile phone business has matured, margins have compressed and the cost of operations in our stand-alone stores is higher than our big-box stores.”
All of the company’s “Best Buy Mobile” stores are in shopping malls and measure about 1,400 square feet. A regular Best Buy store covers about 40,000 square feet.
According to the Star Tribune, employees who work at the mobile stores will be offered severance. Joly also said the company will work to transfer as many employees as possible to nearby stores or to other roles.