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Cost of Goods Sold
\$29,963 Mil (TTM As of Jan. 2017)

Best Buy Co Inc's cost of goods sold for the three months ended in Jan. 2017 was \$10,452 Mil. Its cost of goods sold for the trailing twelve months (TTM) ended in Jan. 2017 was \$29,963 Mil.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Best Buy Co Inc's Gross Margin for the three months ended in Jan. 2017 was 22.47%.

Cost of Goods Sold is also directly linked to Inventory Turnover. Best Buy Co Inc's Inventory Turnover for the three months ended in Jan. 2017 was 1.87.

Definition

Cost of goods sold (COGS) refers to the Inventory costs of those goods a business has sold during a particular period.

Best Buy Co Inc Cost of Goods Sold for the trailing twelve months (TTM) ended in Jan. 2017 was 6298 (Apr. 2016 ) + 6471 (Jul. 2016 ) + 6742 (Oct. 2016 ) + 10452 (Jan. 2017 ) = \$29,963 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

Best Buy Co Inc's Gross Margin for the three months ended in Jan. 2017 is calculated as:

 Gross Margin = (Revenue - Cost of Goods Sold) / Revenue = (13482 - 10452) / 13482 = 22.47 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

A company that has a moat can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have moats.

Cost of Goods Sold is also directly linked to another concept called Inventory Turnover:

Best Buy Co Inc's Inventory Turnover for the three months ended in Jan. 2017 is calculated as:

 Inventory Turnover = Cost of Goods Sold / Average Inventory = 10452 / 5597.5 = 1.87

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Best Buy Co Inc Annual Data

 Feb08 Feb09 Feb10 Feb11 Feb12 Jan13 Jan14 Jan15 Jan16 Jan17 COGS 30,477 34,017 37,201 37,206 34,473 29,229 31,212 31,292 30,337 29,963

Best Buy Co Inc Quarterly Data

 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 COGS 6,956 11,183 6,528 6,430 6,707 10,672 6,298 6,471 6,742 10,452
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