Best Buy Announces Quarterly Dividend of $0.95 Per Share

Best Buy has declared a quarterly dividend of $0.95 per share, in line with previous declarations. The forward yield is 5.23%. The dividend is payable on October 9 for shareholders of record on September 18. The ex-dividend date is also September 18.

Best Buy Co., Inc. (BBY) has announced a quarterly dividend of $0.95 per share, aligning with its previous declarations. The forward yield stands at 5.23%, making it attractive to dividend investors. The dividend will be payable on October 9, 2025, to shareholders of record as of September 18, 2025, with the ex-dividend date also set for September 18, 2025 [1].

Best Buy's dividend yield has consistently been one of the highest in the retail sector, currently at 5.48%. Over the past three years, the company has increased its dividend by an average of 20.74% per year, reflecting its commitment to rewarding shareholders [2]. This latest dividend increase is part of a 20-year streak of consecutive dividend hikes, further underscoring the company's financial stability and shareholder-friendly policies.

The dividend payout ratio for Best Buy is currently high, standing at 91.7% based on earnings. However, the company's strong free cash flow (FCF) of $1.26 billion over the past 12 months provides a significant buffer, indicating its ability to maintain dividend payments even in challenging economic conditions [2]. The company's recent Q2 FY2026 results, which showed $9.44 billion in revenue and a 1.6% increase in comparable sales, further validate its financial health [1].

Best Buy's strategic pivot towards higher-margin revenue streams, including its third-party marketplace and Best Buy Ads platform, is crucial for the long-term sustainability of its dividend. These initiatives aim to diversify income beyond traditional retail sales, replicating the omnichannel success of competitors like Amazon and Walmart [2]. The company's forward-looking projections indicate that these new revenue streams could help improve earnings and stabilize gross profit margins.

While Best Buy's high dividend yield and strong FCF position it favorably, investors should remain vigilant regarding its high payout ratio and debt-to-equity ratio of 1.47. The company's debt load and the limited room for error in its payout ratio could pose risks if earnings falter. However, Best Buy's $1.58 billion cash balance and disciplined capital allocation provide a safety net, making it a compelling case study in dividend sustainability amid evolving retail dynamics.

References:
[1] Best Buy Reports Second Quarter Results [https://corporate.bestbuy.com/2025/best-buy-reports-q2-fy26/]
[2] Best Buy Co., Inc. Strategic Growth: Marketplace, Ads & ... [https://monexa.ai/blog/best-buy-co-inc-strategic-growth-analysis-marketpl-BBY-2025-07-28]