The JB Hi-Fi Ltd (ASX: JBH) share price is in the red on Wednesday after the electronics retailer released a sales update this morning.
At the time of writing, the JB Hi-Fi share price is down 3.40% to $75.22.
That adds to a weaker run over the past few months, with the stock now down 21% since the start of the year.
Today's move may look strange at first glance, given the company reported sales growth across most of its major divisions.
But investors appear to be focusing on the weaker parts of the update, along with cost pressure flagged by management.
Here's what JB Hi-Fi reported.
Image source: Getty Images
Sales are still growing
JB Hi-Fi said group sales continued to grow during the third quarter of FY26, covering the period from 1 January to 31 March.
In Australia, JB Hi-Fi sales rose 4% on a total basis, while comparable sales increased 2.6%. The New Zealand business was much stronger, with total sales up 23.2% and comparable sales rising 15.2%.
The Good Guys also posted growth, with total and comparable sales both up 2.5%. The weaker spot was e&s, where total sales fell 1.4% and comparable sales dropped 4.8%.
The year-to-date numbers were still positive across the group.
JB Hi-Fi Australia has lifted total sales by 5.7% so far this financial year, while New Zealand sales are up 29.7%. The Good Guys has grown total sales by 3.6%, and e&s remains slightly ahead on a total basis, with sales up 1.6%.
So why are investors selling
The pressure on the share price looks more closely tied to what management said about the trading environment.
Group CEO Nick Wells said the company was pleased to see sales growth in JB Hi-Fi and The Good Guys in what he described as an increasingly uncertain retail environment.
He also said the company is entering the key end-of-financial-year trading period with technology categories facing supplier component-related cost increases and stock availability shortages.
On top of that, JB Hi-Fi is dealing with heightened competition.
JB Hi-Fi is still selling more, but investors are now weighing up how much of that growth can flow through if costs rise and competitors keep pushing hard on price.
That is especially relevant after such a big run in previous years when shares were trading above $100. The stock is now down 21% in 2026 and 27% over the past 12 months.
Foolish takeaway
I do not think this update was bad. The sales growth is still there, and New Zealand was easily the strongest part of the update.
But I can see why the market is being cautious today. The update was not clean enough to ignore the pressure building around costs, stock supply, and competition.
From my side, I would want to see whether JB Hi-Fi can keep growing sales without giving up too much margin.
Until there is more evidence of that, I am not in a rush to step in just because the share price is lower today.
