Best Buy Co. Inc. is cutting 2,400 jobs, including 600 Geek Squad tech support specialists and 1,800 store employees, as the company tries to redirect its resources toward new growth strategies, such as small-business services and its next-generation Connected Stores.

The layoffs represent about 1.4 percent of the company's global workforce of 167,000. Best Buy, which employs more than 7,500 people in Minnesota, did not disclose how many local workers will lose their jobs.

The cuts are in addition to a three-year restructuring plan announced earlier this year, in which the company pledged to trim 400 corporate jobs and eliminate 50 of its 1,100 big-box stores nationwide to secure $800 million in savings.

"We are working to minimize the impact of the changes on employees while building the foundation for a strong future," company spokesman Bruce Hight said Friday in a statement. The company declined to make an executive available for an interview.

The retail giant, which began in 1966 as a fledgling music store in St. Paul, remains the largest consumer electronics retailer in the country with annual sales topping $50 billion. But in recent years, the retailer has struggled to grow sales as shoppers turned to Wal-Mart, Target and Amazon.

In a recent speech to shareholders, interim CEO G. "Mike" Mikan suggested the days of Best Buy generating significant cash flow without making changes to its operations are nearing an end.

"This is a fundamental shift," Mikan said. "This isn't just about selling connections and tech repair. Our people will offer advice and insight.... We're going to make tough decisions about shrinking the company's physical footprint. Total square footage will go down as we make decisions about the best use of resources."

The decision to eliminate Geek Squad personnel puzzled some analysts, who say the tech support business is one of Best Buy's strongest assets.

"This is institutional insanity," said Burt Flickinger III, managing director of Strategic Resource Group consulting group in New York. Best Buy "is cutting its best and brightest people at a time when the company is fighting for its future."

Best Buy officials say the cuts, which represent about 3 percent of Geek Squad's 20,000-strong workforce, primarily affect technicians who service televisions and appliances at consumers' homes. Sales of televisions in particular, once one of Best Buy's strongest categories, have languished in recent years as prices dropped and more retailers encroached on Best Buy's turf.

"We recently made some adjustments to position our talent where we're seeing growth and give our agents the opportunity to serve customers best," Matthew Furman, Best Buy's senior vice president of communications and public policy, told Dow Jones Newswires.

New business focus

Best Buy is redirecting its Geek Squad agents toward services for small businesses, a $40 billion market. Earlier this year, the company paid $161 million to acquire MindShift Technologies, a provider of data storage and other IT services to small- to medium-sized businesses. And in March, Best Buy said Geek Squad will sell 24/7 tech support plans to small companies, which include diagnostics and repair, data security and server administration.

Best Buy also is deploying more Geek Squad techies to its remodeled Connected Stores, which emphasize more personalized, higher-end service. At the center of each Connected Store is Geek Squad Solution Central, modeled after Apple's Genius Bar. Geek Squad agents offer free tech support and tutorials to customers on devices that run both Apple's iOS and Google's Android operating system.

Best Buy executives say they have made a "significant labor investment" in those workers, in hopes of reducing returns and exchanges and establishing longer-term relationships with customers. Best Buy hopes to establish 50 more Connected Stores by the end of the year.

Essentially, Geek Squad agents will specialize in services that produce a greater return, rather than offering everything to everyone, said Carol Spieckerman, president of Newmarketbuilders, a retail consulting firm.

With Geek Squad, the company is "going for quality over quantity," Spieckerman said, "instead of worker bees moving around all day working on a lot of tasks."

A year of upheaval

The job cuts and strategy shifts are the latest twists in what has been one of the most tumultuous years in company history.

CEO Brian Dunn abruptly resigned earlier this year over allegations that he had an improper relationship with a female employee. Founder Richard Schulze agreed to relinquish his role as board chairman last month after it was determined he failed to inform the board of directors about the allegations involving Dunn.

Since then, Schulze has been exploring options for his major ownership stake, including a possible takeover bid.

Best Buy has lost several key executives since the internal turmoil began, including chief technology officer and Geek Squad founder Robert Stephens. The company recently decided to collectively pay its four top executives $2 million in cash to cement their ties to the retailer while the search for a permanent CEO continues.

Thomas Lee • 612-673-4113