Best Buy Co. Inc.: 10-K Risk Factor Changes

To varying degrees, our products and services are sensitive to changes in macroeconomic conditions. Consumer demand for the products and services that we offer could be, or could continue to be, affected by a number of factors, including: real GDP growth, inflation, recession, consumer confidence, employment levels, effects of government closures, cost of living, uncertainty over the availability of government benefits, tax rates, availability of consumer financing, interest rates, housing market conditions, foreign currency exchange rates, the price of oil, gas and other commodities and other macroeconomic trends. Additionally, the impact of these factors could be compounded with respect to discretionary purchases of consumer electronics. These macroeconomic conditions impact consumer behavior and spending in various ways, including: •whether consumers make a purchase; •how frequently consumers upgrade or replace their devices; •consumers' choice of brand, model or price-point; and •consumers' appetite for complementary services (for example, My Best Buy Plus™ or My Best Buy Total™ membership). Any decrease in consumer demand due to macroeconomic conditions may negatively impact our financial results. We are subject to specific pressures that may increase our product prices, including high consumer demand, inflation, governmental actions (e.g., tariffs) and supply chain disruptions. Additionally, price increases in the products we purchase for resale may require us to adjust our sales prices. Our ability to increase prices to offset these pressures might be limited, requiring us to absorb these increases within our margins. Increases in the cost of living may also put pressure on our ability to offer competitive compensation and other employer-provided benefits and may adversely affect our financial results. Any economic factors or circumstances resulting in higher costs for transportation, labor, insurance, healthcare or commodities can increase our operating, selling, general and administrative costs and otherwise materially adversely affect our financial results. 9 9 9 Table of Contents Table of Contents