Sales drop triggers share plunge at retail bellwether

Shares in a leading electronics and homewares retailer are on track for their worst single-day loss after sales took a hit for the start of the new financial year.

JB Hi-Fi shares by midday on Monday had plunged 11.4 per cent to $72.41, on pace to exceed their 10.8 per cent fall on March 23, 2020, at the start of the COVID-19 pandemic.

The company posted solid numbers for the financial year ending June 30, including record sales of $11.06 billion and a sharply higher dividend.

But investors appeared to be looking past those figures and at its trading update for 2026/27, eToro analyst Josh Gilbert said.

Same-store sales at the group's flagship Australian JB Hi-Fi stores were down 1.4 per cent in July compared to the same month in 2025 and had dropped 1.7 per cent at appliance chain The Good Guys.

"It is one month, it is a small month, and I would say, it's not a promotional period," JB Hi-Fi chief executive Nick Wells told analysts on a conference call.

"Promotional periods have become increasingly important when customers are looking for value,.

"So periods like end-of-financial-year in June or Black Friday become really important and then maybe it touches a little bit those non-promotional periods like July."

The previous year's July sales were boosted by a new Nintendo handheld video game console and the release of Samsung's latest folding smartphone, Mr Wells added.

Suppliers had also enacted some "pretty material" price rises with less frequent discounting, he said.

Tech companies such as Apple have blamed soaring chip prices, driven by demand from artificial intelligence data centres, for increasing costs.

It was difficult to say how much of the July sales drop was driven by rising prices and how much it was caused by cost-of-living pressures, Mr Wells said.

But Mr Gilbert noted problems with supply and demand had the same impact on profits.

"Rent and wages don't stop just because there's less stock to sell," he said.