Best Buy CEO Brian Dunn Abruptly Resigns
Brian Dunn, CEO of Richfield-based Best Buy Company, Inc., has resigned, the company said Tuesday.
“There were no disagreements between Mr. Dunn and the company on any matter relating to operations, financial controls, policies, or procedures,” Best Buy said in a news release. “There was mutual agreement that it was time for new leadership to address the challenges that face the company.”
Dunn has worked for Best Buy for nearly three decades and took the helm as chief executive in 2009, becoming only the third CEO in the company's history. He succeeded Brad Anderson, who led the company after Richard Schulze, Best Buy's founder.
“I have enjoyed every one of my 28 years with this company, and I leave it today in position for a strong future,” Dunn said in a statement.
The company's board of directors has begun a search for Dunn's permanent replacement-and G. Mike Mikan, who has served on Best Buy's board since 2008, will lead the company as interim CEO during the search process.
Mikan formerly served as chief financial officer of Minnetonka-based UnitedHealth Group, Inc., and as CEO of its Optum subsidiary. He left UnitedHealth last July.
The price of Best Buy's stock shot up roughly 4 percent Tuesday morning to $23.56, but it had slid to $21.53 by early afternoon.
Dunn's resignation comes less than two weeks after he unveiled plans for a major restructuring of the company's business model and work force. The plans include cutting 400 positions at Best Buy's Richfield headquarters, closing 50 big-box stores, shifting some big-box stores to a smaller “connected-store” format, opening 100 new standalone Best Buy Mobile stores in the United States, and adding 50 new Five Star appliance stores in China.
The company expects those moves to result in $800 million in savings during the next three years, including $250 million in savings this year.
Best Buy-Minnesota's third-largest public company-recently reported revenue of $50.7 billion for the fiscal year that ended last month. It reported a loss of $3.36 per share for the year, compared to earnings of $3.08 per share during the previous year. Same-store sales-sales at stores open at least a year-declined 1.7 percent during the fiscal year.
The company has been sharply criticized by some media reports, including a Forbes article titled “Why Best Buy Is Going Out of Business . . . Gradually,” which was published prior to Best Buy announcing its restructuring plans. After the article was published, Dunn generated headlines by publicly defending Best Buy in his blog-a move that opened the door to additional criticism from the public in the blog's comment section. Dunn responded publicly once again, welcoming the feedback and saying his leadership team was developing solutions to the problems voiced by critics.
Last week, Best Buy experienced another setback, when Standard & Poor's placed the electronics retailer's credit rating on watch “with negative implications”-an indication that the agency is considering downgrading the company's credit rating to “junk” status.
Some recent media reports suggested that Dunn's time as the company's leader was nearing an end. But the Star Tribune recently reported that Dunn had the support of Schulze, the company's founder, chairman, and largest shareholder-a sign that his role likely was not in danger.