The company continues to face stiff competition from Wal-Mart Stores Inc. (WMT) and other rivals. Also, consumer spending may be further hurt if unemployment hits 10 percent by Labor Day as many economists expect. Housing remains lackluster as well, though it is showing signs of improvement.

"We believe the success of our company is based on our ability to build relationships with customers around the world," said Brian Dunn, president and COO of Best Buy, who becomes CEO on June 24, 2009, said in the earnings press release. "Regardless of the environment we find ourselves in, we know that our people will continue to be our key point of differentiation in helping Best Buy grow. We believe this was the driving force behind our better-than-expected results in the first quarter."

There were some signs of weakness. Comparable store sales declined 6.2 percent and results were further hurt by the unfavorable impact of foreign currency fluctuations. The company, though, was able to increased revenue while the overall industry declined by double digits. Moreover, Best Buy's main rival Circuit City went out of business earlier this year.

Best Buy, whose shares have gained more than 37 percent this year, maintained its annual earnings guidance of $2.50 to $2.90 per share excluding restructuring charges.