Best Buy is losing money hand over foot – reporting a loss of $1.7 billion over the fourth quarter of 2011. That’s the quarter than includes Christmas holiday shopping,a devastating way to start the new year.

The loss wasn’t all due to a lack of sales. Overall net revenue was actually up 3% over the same time period a year ago. Best Buy took a write-off due to the closing of it’s UK stores, and bought out a stake of it’s Best Buy partnership that was owned by Carphone Warehouse, which account for some, but not all, of the loss.

Best-BuyStill, earnings were down, and Best Buy has announced that they will close 50 of their big-box stores. A list of which stores they will be closing is not yet available.

The plan is to cut costs by $800 million, and along with the store closings, 400 corporate and support positions will be cut as well. Best Buy did state that they will try to help those whose jobs are affecting find other positions within the company.

Though they will be closing some of their larger stores, Best Buy plans to open smaller ones. Their plans include opening 100 Best Buy Mobile and smaller stores, and increasing online revenue by 15%.

Best Buy CEO Brian Dunn told investors:

“Over the last three years, the industry experienced little innovation and many of the large traditional consumer electronics categories such as television, PCs and gaming. At the same time, consumers have enjoyed greater price transparency and ease of costs shopping. As a result, we knew we had to accelerate our cost reduction efforts, adjust our sales mix and significantly improve on the experience we were delivering for our customers. All of this in the most uncertain consumer and economic environment we’ve ever experienced.”

Is Best Buy making smart moves – or going the way of Circuit City and Sears/Kmart? Add your thoughts in the comment section below.