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What happened

Shares of Best Buy Co., Inc. (BBY -0.50%) were up 13.5% as of 2:45 p.m. EST Thursday, after the electronics retailer announced stronger-than-expected fiscal third-quarter 2017 results.

So what

Quarterly revenue grew 1.4% year over year, to $8.95 billion, including a 1.8% increase in domestic segment comparable-store sales. That translated to 37.5% growth in adjusted net income, to $198 million, and 51% growth in adjusted earnings per diluted share, to $0.62. Best Buy repurchased 5.4 million shares during the quarter for a total of $201 million, bringing year-to-date repurchases to 15.7 million shares for $517 million.

Analysts, on average, were anticipating Best Buy would turn in lower revenue of $8.85 billion, and adjusted earnings of only $0.47 per share.

Best Buy chairman and CEO Hubert Joly added, "We are excited by the continued product innovation we are seeing, the role we play for customers, the growth opportunities in front of us, the quality of our execution and the strength of our financial performance."

Now what

For the current quarter, Best Buy expects revenue of $13.4 billion to $13.6 billion, with a change in comparable sales ranging from negative 1% to positive 1%. That should translate to adjusted earnings per diluted share of $1.62 to $1.67. By contrast, Wall Street's consensus estimates called for higher fourth-quarter revenue of $13.7 billion, and lower earnings of $1.58 per share.

To explain the top-line guidance shortfall, Best Buy CFO Corie Barry noted, "[W]e have updated our original expectations to incorporate the impact of recent product recalls and the fact that certain products will simply not be available for sale during the fourth quarter."

More specifically, those recalls are expected to negatively affect Best Buy's domestic revenue by roughly $200 million. To be fair, though, had it not been for the recalls, Best Buy's revenue would have been in line with expectations. And it's exceedingly impressive that its earnings guidance is well above Wall Street's view despite that top-line headwind. All things considered, then, it's no surprise to see shares trading higher today.