UPDATE:Best Buy CEO Rejects Notion Co Driving Share Via Discounting

Best Buy Co. (BBY) President and Chief Executive Brian Dunn on Wednesday rejected the notion that the consumer electronics retailer is driving its market-share gains by discounting.

Speaking during a holiday preview for the media in Manhattan, Dunn said that Best Buy intends to "bet on price points" for specific items, and stock inventory according to demand. But he said the company's emphasis on service through its Geek Squad business will help differentiate it among shoppers.

Concerns that aggressive promotions will weigh on Best Buy's profits in coming quarters have pressured shares since the retailer reported second-quarter results Sept. 15. Shares recently traded down 0.5% at $37.67.

But Dunn said Wednesday he is "very confident" that Best Buy will achieve the $2.70 to $3 a share per-share earnings that the company outlined two weeks ago when it raised its fiscal 2009 guidance.

Dunn also said Best Buy will hire more holiday workers this year than in 2008, though he didn't provide specific figures. The need is likely to be driven, in part, by demand for mobile phones and internet-connected flat-panel televisions, he said. Best Buy sold more flat-panel TVs in July than last December, and Dunn expects to sell more this holiday season.

A recent survey by human resources consulting firm Hay Group Inc. found nearly half the nation's 25 biggest retail chains expect to hire fewer holiday workers this season than they did last year.

Toys "R" Us on Wednesday said it plans to hire 35,000 seasonal workers nationwide, the same number as the past two holiday seasons.

Best Buy's Dunn named several products he expects will be hot at the largest U.S. electronics retailer by sales this holiday season: Blu ray disc players, netbooks, smartphones and ultra-thin LED TVs. Gift cards, too, should prove popular, and electronic book readers could be "very interesting," he said.

And despite industry concerns that netbook sales will steal away business from notebook computers, Dunn said the two are really more "companion" pieces.

"It's (the netbook) not a piece I bring to Europe, because I need more horsepower with me," Dunn said.

(Mary Ellen Lloyd contributed to this story.)

-By Veronica Dagher, Dow Jones Newswires; 212-416-2261; [e-mail]