UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            -------------------------

                                    FORM 10-Q

[X]   Quarterly  report  pursuant  to  Section  13 or  15(d)  of the  Securities
      Exchange Act of 1934 For the quarterly period ended May 31, 2005
                                       OR
[ ]   Transition  report  pursuant  to  Section  13 or 15(d)  of the  Securities
      Exchange Act of 1934 For the transition period from  ------ to -----

                         Commission file number: 1-5767

                            CIRCUIT CITY STORES, INC.
             (Exact name of registrant as specified in its charter)

                 Virginia                                    54-0493875
      (State or other jurisdiction of                     (I.R.S. Employer
      incorporation or organization)                     Identification No.)

            9950 Mayland Drive
            Richmond, Virginia                                  23233
(Address of principal executive offices)                     (Zip Code)

                                 (804) 527- 4000
              (Registrant's telephone number, including area code)

                                       N/A
             (Former name, former address, and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes |X| No

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2). Yes |X| No ___

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

           Class                                 Outstanding at June 30, 2005
Common Stock, par value $0.50                             185,622,900


A Table of Contents  is  included on Page 2 and an Exhibit  Index is included on
Page 26.





                   CIRCUIT CITY STORES, INC. AND SUBSIDIARIES

                                TABLE OF CONTENTS



PART I.  FINANCIAL INFORMATION

      Item 1.     Financial Statements:

                     Consolidated Statements of Operations -
                     Three Months Ended May 31, 2005 and 2004                                             3

                     Consolidated Balance Sheets -
                     May 31, 2005 and February 28, 2005                                                   4

                     Consolidated Statements of Cash Flows -
                     Three Months Ended May 31, 2005 and 2004                                             5

                     Notes to Consolidated Financial Statements                                           6

      Item 2.     Management's Discussion and Analysis of Financial Condition
                  and Results of Operations                                                              12

      Item 3.     Quantitative and Qualitative Disclosures about Market Risk                             22

      Item 4.     Controls and Procedures                                                                22

PART II.          OTHER INFORMATION

      Item 1.     Legal Proceedings                                                                      22

      Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds                            23

      Item 6.     Exhibits                                                                               24

SIGNATURES                                                                                               25

EXHIBIT INDEX                                                                                            26


                                  Page 2 of 26


                          PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                   Circuit City Stores, Inc. and Subsidiaries
                Consolidated Statements of Operations (Unaudited)
                  (Amounts in thousands except per share data)

                                                                                              Three Months Ended
                                                                                                   May 31
                                                                                            2005              2004    
                                                                                         ----------        ----------
Net sales and operating revenues                                                         $2,228,450        $2,094,381
Cost of sales, buying and warehousing                                                     1,670,549         1,599,662
                                                                                         ----------        ----------
Gross profit                                                                                557,901           494,719
Finance income                                                                                    -             5,564
Selling, general and administrative expenses                                                575,325           502,229
Stock-based compensation expense                                                              3,327             5,954
Interest expense                                                                                395               350
                                                                                         ----------        ----------
Loss from continuing operations before income taxes                                         (21,146)           (8,250)
Income tax benefit                                                                           (8,037)           (3,016)
                                                                                         ----------        ----------
Net loss from continuing operations                                                         (13,109)           (5,234)
Net loss from discontinued operation                                                              -              (707)
                                                                                         ----------        ----------
Net loss                                                                                 $  (13,109)       $   (5,941)
                                                                                         ==========        ==========

Weighted average common shares:
    Basic                                                                                   184,729           199,429
                                                                                         ==========        ==========
    Diluted                                                                                 184,729           199,429
                                                                                         ==========        ==========
Net loss per share: 
    Basic:
       Continuing operations                                                             $    (0.07)       $    (0.03)
       Discontinued operation                                                                     -                 -
                                                                                         ----------        ----------
                                                                                         $    (0.07)       $    (0.03)
                                                                                         ==========        ==========
    Diluted:
       Continuing operations                                                             $    (0.07)       $    (0.03)
       Discontinued operation                                                                     -                 -
                                                                                         ----------        ----------
                                                                                         $    (0.07)       $    (0.03)
                                                                                         ==========        ==========


Cash dividends paid per share                                                             $  0.0175        $   0.0175
                                                                                          =========        ==========

See accompanying notes to consolidated financial statements.


                                  Page 3 of 26



                   Circuit City Stores, Inc. and Subsidiaries
                           Consolidated Balance Sheets
                    (Amounts in thousands except share data)

                                                                                        May 31, 2005     Feb. 28, 2005
                                                                                        ------------     -------------
                                                                                        (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents                                                               $  598,317        $  879,660
Short-term investments                                                                     200,339           125,325
Accounts receivable, net                                                                   164,517           172,995
Merchandise inventory                                                                    1,677,981         1,459,520
Deferred income taxes                                                                       27,602            29,518
Income tax receivable                                                                       13,003                 -
Prepaid expenses and other current assets                                                   44,261            18,697
                                                                                        ----------        ----------

Total current assets                                                                     2,726,020         2,685,715

Property and equipment, net of accumulated depreciation of
     $1,125,881 and $1,104,137                                                             716,640           738,802
Deferred income taxes                                                                       84,518            73,558
Goodwill                                                                                   206,267           215,884
Other intangible assets, net of accumulated amortization of
     $3,810 and $3,035                                                                      30,057            31,331
Other assets                                                                                42,687            44,092
                                                                                        ----------        ----------

TOTAL ASSETS                                                                            $3,806,189        $3,789,382
                                                                                        ==========        ==========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                                                                        $1,169,508        $  961,718
Accrued expenses and other current liabilities                                             220,331           228,966
Accrued income taxes                                                                             -            72,274
Current installments of long-term debt                                                       1,329               888
                                                                                        ----------        ----------

Total current liabilities                                                                1,391,168         1,263,846

Long-term debt, excluding current installments                                              12,134            11,522
Accrued straight-line rent and deferred rent credits                                       234,045           230,426
Accrued lease termination costs                                                             96,196           104,234
Other liabilities                                                                           90,764            91,920
                                                                                        ----------        ----------

TOTAL LIABILITIES                                                                        1,824,307         1,701,948
                                                                                        ----------        -----------

Stockholders' equity:
Common stock, $0.50 par value;
     525,000,000 shares authorized; 182,981,087 shares
     issued and outstanding at May 31, 2005
     (188,150,383 at February 28, 2005)                                                     91,491            94,075
Capital in excess of par value                                                             640,635           721,038
Retained earnings                                                                        1,228,936         1,247,221
Accumulated other comprehensive income                                                      20,820            25,100
                                                                                        ----------        ----------

TOTAL STOCKHOLDERS' EQUITY                                                               1,981,882         2,087,434
                                                                                        ----------        ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                              $3,806,189        $3,789,382
                                                                                        ==========        ==========
See accompanying notes to consolidated financial statements.


                                  Page 4 of 26


                   Circuit City Stores, Inc. and Subsidiaries
                Consolidated Statements of Cash Flows (Unaudited)
                             (Amounts in thousands)

                                                                                             Three Months Ended
                                                                                                   May 31
                                                                                           2005             2004   
                                                                                        ---------         --------
Operating Activities:
Net loss                                                                                $ (13,109)       $  (5,941)
Adjustments to reconcile net loss to net cash (used in) provided by
    operating activities of continuing operations:
    Loss from discontinued operation                                                            -              707
    Depreciation and amortization                                                          40,796           38,952
    Stock option expense                                                                    2,732            4,011
    Amortization of restricted stock awards                                                   269           1,722
    Loss on dispositions of property and equipment                                          1,179             660
    Provision for deferred income taxes                                                     3,255          (71,444)
    Changes in operating assets and liabilities:
       Decrease (increase) in accounts receivable, net                                     10,384           (6,517)
       Decrease in retained interests in securitized receivables                                -           32,867
       (Increase) decrease in merchandise inventory                                      (220,837)          74,072
       Increase in prepaid expenses and other current assets                              (24,594)         (22,552)
       Decrease in other assets                                                               324            5,541
       Increase in accounts payable                                                       208,489           71,038
       Decrease in accrued expenses, other current liabilities and
           accrued income taxes                                                           (96,780)          (6,341)
       Decrease in other long-term liabilities                                             (6,425)          (8,463)
                                                                                        ---------        ---------
Net cash (used in) provided by operating activities of continuing
       operations                                                                         (94,317)         108,312
                                                                                        ---------        ---------

Investing Activities:
Proceeds from the sale of the private-label finance operation                                   -          472,710
Acquisitions, net of cash acquired of $30,615                                                   -         (265,456)
Purchases of property and equipment                                                       (33,272)         (42,694)
Proceeds from sales of property and equipment                                              10,605           15,803
Purchases of investment securities                                                        (99,638)               -
Proceeds from maturities of investment securities                                          25,000                -
                                                                                        ---------        ---------
Net cash (used in) provided by investing activities of continuing
       operations                                                                         (97,305)         180,363
                                                                                        ---------        ---------

Financing Activities:
Principal payments on long-term debt                                                         (341)          (2,412)
Repurchases of common stock                                                               (92,918)         (71,054)
Issuances of common stock, net                                                              8,906            1,223
Dividends paid                                                                             (3,300)          (3,575)
Redemption of preferred share purchase rights                                              (1,876)               -
                                                                                        ---------        ---------
Net cash used in financing activities of continuing operations                            (89,529)         (75,818)
                                                                                        ---------        ---------
Net cash used in discontinued bankcard finance operation                                        -           (6,169)
Effect of exchange rate changes on cash                                                      (192)             412
                                                                                        ---------        ---------

(Decrease) increase in cash and cash equivalents                                         (281,343)         207,100
Cash and cash equivalents at beginning of year                                            879,660          783,471
                                                                                        ---------        ---------
Cash and cash equivalents at end of period                                              $ 598,317        $ 990,571
                                                                                        =========        =========

See accompanying notes to consolidated financial statements.




                                  Page 5 of 26


                   CIRCUIT CITY STORES, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

1.   Basis of Presentation

     Circuit  City  Stores,  Inc.  is a leading  specialty  retailer of consumer
     electronics,  home  office  products,  entertainment  software  and related
     services. The company has two reportable segments: its domestic segment and
     its international segment.

     The  domestic  segment  is  primarily  engaged in the  business  of selling
     brand-name consumer electronics, personal computers, entertainment software
     and  services in Circuit  City  Superstores  and  mall-based  stores in the
     United States and via the Web at www.circuitcity.com.  At May 31, 2005, the
     company's  domestic  segment  operated 612  Superstores and five mall-based
     stores in 158 U.S. media markets.

     The international segment is comprised of the operations of InterTAN,  Inc.
     On May 12, 2004, the company  acquired a controlling  interest in InterTAN,
     Inc. and on May 19, 2004,  completed its  acquisition of 100 percent of the
     common stock of InterTAN for cash  consideration  of $259.3 million,  which
     includes transaction costs and is net of cash acquired of $30.6 million. In
     addition to giving Circuit City a greater  product-sourcing  capability and
     the ability to accelerate the offering of private-label  merchandise to its
     customers, the acquisition of InterTAN gives the company its first presence
     in the Canadian market. InterTAN is a leading consumer electronics retailer
     of both private-label and brand-name  products with headquarters in Barrie,
     Ontario, Canada. InterTAN operates through retail stores and dealer outlets
     in  Canada   under  the  trade   names  THE  SOURCE  BY   CIRCUIT   CITYSM,
     RadioShack(R),  Rogers  Plus(R) and Battery  Plus(R).  At May 31, 2005, the
     international  segment was in the process of re-branding stores operated by
     InterTAN  under  license from  RadioShack(R)  Corporation  to THE SOURCE BY
     CIRCUIT CITYSM as a result of the ongoing litigation with RadioShack(R). At
     that date, the international  segment conducted business through 967 retail
     stores and dealer outlets,  which consisted of 522  InterTAN-owned  stores,
     330 dealer outlets, 90 Rogers Plus(R) stores and 25 Battery Plus(R) stores.
     The international  segment also operates a Web site at  www.thesourcecc.ca.
     See Note 2 for additional discussion of the litigation.

     On May 25,  2004,  the  company  completed  the  sale of its  private-label
     finance  operation,  comprised of its  private-label  and  co-branded  Visa
     credit  card  programs,   to  Chase  Card   Services,   formerly  Bank  One
     Corporation.  Results from the private-label  finance operation,  including
     transition and transaction costs of approximately $6 million related to the
     sale of the operation, are included in finance income for the quarter ended
     May 31, 2004. The company also entered into a Consumer  Credit Card Program
     Agreement  under which Chase Card  Services is offering  private-label  and
     co-branded  credit  cards to new and  existing  customers.  The  company is
     compensated  under the program  agreement  primarily based on the number of
     new  accounts  opened  less  promotional  financing  costs  that  exceed  a
     negotiated  base  amount.  The net results from the program  agreement  are
     included in net sales and operating revenues on the consolidated statements
     of operations.

     The preparation of financial  statements in conformity with U.S.  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that  affect the  reported  amounts  of  assets,  liabilities,
     revenues  and  expenses  and  the  disclosure  of  contingent   assets  and
     liabilities. Actual results may differ from those estimates. In the opinion
     of management,  the accompanying unaudited financial statements contain all
     adjustments, which consist only of normal, recurring adjustments, necessary
     for a fair  presentation.  Due  to the  seasonal  nature  of the  company's
     business, interim results are not necessarily indicative of results for the
     entire  fiscal  year.  The  company's   consolidated  financial  statements
     included in this report should be read in conjunction with the notes to the
     audited financial  statements in the company's fiscal 2005 Annual Report on
     Form 10-K.

     Certain prior year amounts have been reclassified to conform to the current
     presentation.

                                  Page 6 of 26


2.   Litigation

     After  Circuit  City's March 31,  2004,  announcement  of its  agreement to
     acquire InterTAN,  RadioShack(R)  Corporation asserted early termination of
     its  licensing  and  other  agreements  with  InterTAN.  On April 5,  2004,
     RadioShack(R)  filed suit against InterTAN,  and amended that suit on April
     27,  2004  (the   "RadioShack(R)   litigation").   InterTAN   disputes  the
     termination  scenarios alleged by RadioShack(R) and is vigorously defending
     against those claims.  InterTAN also has filed claims for disparagement and
     unfair  business  practices  against  RadioShack(R).  The parties  argued a
     RadioShack(R)  motion for partial summary  judgment on February 3, 2005. On
     March 24, 2005,  the court issued an order on that motion  stating that the
     agreements  were  terminated  no later than  December 31,  2004.  Under the
     ruling, InterTAN's rights under the three agreements expired June 30, 2005.

     Circuit City  continues to believe  that  RadioShack(R)  is not entitled to
     early  termination  of the  agreements  and that  InterTAN has  substantial
     defenses  to  the  RadioShack(R)  claims.   InterTAN  intends  to  continue
     vigorously  defending  the claims in the  RadioShack(R)  litigation  and to
     exercise its rights  under the  agreements,  as well as any appeal  rights.
     Circuit City believes that this litigation will not have a material adverse
     effect on the company's  financial  condition or results of operations  for
     the 2006 fiscal year.

3.   Finance Income

     Finance  income  for the three  months  ended May 31,  2004,  includes  the
     results  from the  company's  private-label  finance  operation,  including
     transition and transaction costs of approximately $6 million related to the
     sale of the  operation to Chase Card  Services,  through May 25, 2004,  the
     date the company completed the sale.

     For the three months ended May 31, 2004,  the  components of pretax finance
     income were as follows:

                                                              Three Months Ended
     (Amounts in millions)                                       May 31, 2004   
     ---------------------------------------------------------------------------
     Securitization income................................           $28.1
     Less: Payroll and fringe benefit expenses............             7.6
             Other direct expenses........................            14.9    
                                                            --------------------
     Finance income.......................................           $ 5.6    
                                                            ====================

     Securitization  income  primarily  is  comprised of the gain on the sale of
     receivables  generated by the company's  private-label  finance  operation,
     income from retained  interests in the credit card  receivables  and income
     related to servicing the receivables, as well as the impact of increases or
     decreases  in the fair  value  of the  retained  interests.  Securitization
     income is reduced by payroll,  fringe  benefits  and other  costs  directly
     associated  with the management  and  securitization  of the  private-label
     receivables.

4.   Stock-Based Compensation

     The company uses the fair value based method of accounting for  stock-based
     compensation.

     The fair value of each stock option  granted is estimated on the grant date
     using the Black-Scholes  option-pricing  model with the following  weighted
     average assumptions.

                                                       Three Months Ended
                                                              May 31
                                                      2005            2004   
     --------------------------------------------------------------------------
     Expected dividend yield......................     0.5%           0.6%
     Expected stock volatility....................      55%            65%
     Risk-free interest rates.....................       4%             4%
     Expected lives (in years)....................       4              5

                                  Page 7 of 26

     Using these  assumptions in the  Black-Scholes  model, the weighted average
     fair value of options  granted was $7.23 per share during the quarter ended
     May 31, 2005, and $6.03 per share during the quarter ended May 31, 2004.

5.   Comprehensive Loss

     The components of the company's  comprehensive loss consist of the net loss
     and other comprehensive (loss) income. Other comprehensive (loss) income is
     comprised of foreign currency  translation  adjustments and is recorded net
     of deferred income taxes directly as a component of stockholders' equity.

     The components of comprehensive loss, net of taxes, were as follows:

                                                        Three Months Ended
                                                             May 31
     (Amounts in millions)                             2005            2004
     -----------------------------------------------------------------------
     Net loss......................................   $(13.1)          $(5.9)
     Foreign currency translation..................     (4.3)            3.3
                                                   -------------------------
     Comprehensive loss............................   $(17.4)          $(2.6)
                                                   =========================

6.   Net Loss Per Share

     For the three  months  ended May 31,  2005 and 2004,  no stock  options  or
     restricted  stock were included in the  calculation of diluted net loss per
     share because the company reported a loss from continuing operations.

     Shares excluded were as follows:

                                                         Three Months Ended
                                                               May 31
     (Shares in millions)                               2005            2004    
     ---------------------------------------------------------------------------
     Options to purchase common stock.................   15.2            17.3
     Restricted stock.................................    1.6             2.5

7.   Common Stock Repurchased 

     The company's  board of directors has  authorized  stock  repurchases up to
     $800 million,  of which $359.8 million remained  available at May 31, 2005.
     The company  repurchased  6.1 million  shares of common  stock at a cost of
     $96.1  million  during the three  months  ended May 31,  2005.  The company
     repurchased  5.8 million  shares of common stock at a cost of $71.1 million
     during the same period last fiscal year.  As of May 31,  2005,  the company
     had  repurchased  34.5  million  shares of common stock at a cost of $440.2
     million.

8.   Pension Plans

     The company has a noncontributory defined benefit pension plan covering the
     majority of domestic segment full-time  employees who are at least 21 years
     of age and have  completed one year of service.  The cost of the program is
     being  funded  currently.  Plan  benefits  generally  are based on years of
     service  and  average  compensation.  The  company  also  has  an  unfunded
     nonqualified benefit restoration plan that restores retirement benefits for
     domestic  segment senior  executives  who are affected by Internal  Revenue
     Code limitations on benefits provided under the company's pension plan.

     The pension plan was frozen as of February 28, 2005,  except for  employees
     who were (i) within  three years of their early  retirement  date or normal
     retirement date; (ii) had reached their early or normal retirement date; or
     (iii) were  permanently  disabled  before March 1, 2005.  As a result,  all
     affected

                                  Page 8 of 26

     employees retain any benefits accumulated to the effective date, but are no
     longer eligible to increase their benefit. The benefit restoration plan was
     frozen as of February 28, 2005, to provide benefits for  participants  who,
     as of that date, were within 10 years of attaining  their early  retirement
     date or normal retirement date.

     The components of the net pension expense for the plans were as follows:

                                                        Three Months Ended
                                                              May 31
     (Amounts in thousands)                              2005             2004  
     --------------------------------------------------------------------------
     Service cost...................................   $   925          $ 3,817
     Interest cost..................................     3,456            3,906
     Expected return on plan assets.................    (4,508)          (4,101)
     Recognized prior service cost..................        54              119
     Recognized actuarial loss......................       265            1,255
                                                    ---------------------------
     Net pension expense............................   $   192          $ 4,996
                                                    ===========================

     Circuit City made no pension plan contributions during the first quarter of
     fiscal 2006. The company intends to make any  contributions  to the defined
     benefit pension plan necessary to meet ERISA minimum funding  standards and
     will make any  additional  contributions  as needed to ensure that the fair
     value of plan assets at February 28, 2006, exceeds the accumulated  benefit
     obligation.  The company does not expect to make a  contribution  in fiscal
     2006.

     A contribution of $618,000, which is equal to the expected benefit payments
     for fiscal  2006,  is  expected to be made to the  restoration  plan during
     fiscal 2006. Benefit payments during the first quarter were $115,850.

9.   Discontinued Operation

     On November  18,  2003,  the  company  completed  the sale of its  bankcard
     finance operation to FleetBoston Financial.  Bankcard results are presented
     as results from discontinued operation.

     For the  quarter  ended May 31,  2004,  the net loss from the  discontinued
     bankcard  finance  operation  totaled  $707,000,   which  is  comprised  of
     post-closing  adjustments  related to the sale of the  bankcard  operation.
     Cash flows related to the  discontinued  operation have been  segregated on
     the consolidated statements of cash flows.

10.  Segment Information

     The company  has two  reportable  segments:  its  domestic  segment and its
     international  segment.  The company identified these segments based on its
     management  reporting structure and the nature of the products and services
     offered by each segment.  The domestic segment is primarily  engaged in the
     business of selling brand-name consumer electronics, personal computers and
     entertainment  software in the United States. The international  segment is
     primarily  engaged in the business of selling  private-label and brand-name
     consumer  electronics  products in Canada.  Prior to the second  quarter of
     fiscal  2005,  the  company  had a third  reportable  segment,  its finance
     operation.  The company  completed  the sale of its  private-label  finance
     operation,  comprised of its  private-label and Visa co-branded credit card
     programs,  to  Chase  Card  Services  on May 25,  2004.  Results  from  the
     private-label finance operation, including transition and transaction costs
     of  approximately  $6  million  related to the sale of the  operation,  are
     included in finance  income for the three months  ended May 31,  2004.  See
     Note 3 for additional discussion of finance income. The company has entered
     into  an   arrangement   under  which  Chase  Card   Services  is  offering
     private-label and co-branded credit cards to new and existing customers and
     providing credit card services to all cardholders. Net credit expenses from
     that arrangement of $526,000 for the quarter ended

                                  Page 9 of 26


     May 31, 2005, are included in the domestic  retail  segment's net sales and
     operating revenues on the consolidated statement of operations.

     Revenue by reportable  segment and the  reconciliation  to the consolidated
     statements of operations were as follows:
 
                                                        Three Months Ended
                                                             May 31
     (Amounts in millions)                              2005           2004    
     --------------------------------------------------------------------------
     Domestic segment..............................   $2,115.2        $2,072.7
     International segment.........................      113.2            21.7
     Finance operation.............................          -            28.1
                                                   ---------------------------
     Total revenues................................    2,228.5         2,122.5
     Less:  securitization income*.................          -            28.1
                                                   ---------------------------
     Net sales and operating revenues .............   $2,228.5        $2,094.4
                                                   ===========================

     *Securitization  income is included in finance  income,  which reflects the
     results of the finance operation and is reported  separately from net sales
     and operating revenues on the statements of operations.

     The net loss  from  continuing  operations  by  reportable  segment  was as
     follows:

                                                             Three Months Ended
                                                                  May 31
     (Amounts in millions)                                  2005          2004
     -------------------------------------------------------------------------
     Domestic segment.................................. $   (7.1)        $(9.1)
     International segment.............................     (6.0)          0.4
     Finance operation.................................        -           3.5
                                                        ----------------------
     Net loss from continuing operations...............   $(13.1)        $(5.2)
                                                        ======================

     Total assets by reportable segment were as follows:

                                           At May 31          At February 28
     (Amounts in millions)                   2005                 2005        
     -------------------------------------------------------------------------
     Domestic segment..................... $3,370.3              $3,354.7
     International segment................    435.8                 434.7     
                                          ------------------------------------
     Total assets......................... $3,806.2              $3,789.4     
                                           ===================================

                                 Page 10 of 26

11.  Supplemental Consolidated Statement of Cash Flows Information

     The following table summarizes  supplemental  cash flow information for the
     three months ended May 31, 2004.



                                                                   Three Months Ended
     (Amounts in millions)                                              May 31, 2004     
     ------------------------------------------------------------------------------------
     Supplemental schedule of non-cash investing and financing
       activities:
       Capital lease obligation....................................        $   2.8
                                                                         =========

     Acquisition of InterTAN:
       Fair value of assets acquired:
           Cash and cash equivalents...............................        $   30.6
           Merchandise inventory...................................            93.0
           Property and equipment, net.............................            42.6
           Goodwill................................................           172.6
           Other intangible assets.................................            37.5
           Other assets............................................             8.7
                                                                         ----------
           Total fair value of assets acquired.....................           384.9

       Less:
           Liablities assumed......................................            88.7
           Cash acquired...........................................            30.6
           Stock options issued....................................             6.5
                                                                         ----------
       Acquistion of InterTAN, net of cash acquired................          $259.1
                                                                         ==========

   Acquisition of MusicNow:
       Fair value of assets acquired...............................        $    7.6
       Less: liabilities assumed...................................             1.3
                                                                         ----------
       Acquistion of MusicNow......................................        $    6.3
                                                                         ==========


12.  Recent Accounting Pronouncements

     In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based
     Payment." SFAS No. 123(R) requires companies to record compensation expense
     based on the fair value of employee  stock-based  compensation  awards. The
     statement also requires that the  compensation  expense be recognized  over
     the period  during  which the  employee is  required to provide  service in
     exchange for the award. SFAS No. 123(R) will be effective for the company's
     first quarter of fiscal 2007. The company has not yet determined the impact
     of adopting this standard.


                                 Page 11 of 26


ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

On May 12, 2004, we acquired a controlling  interest in InterTAN,  Inc. for cash
consideration of $259.3 million,  which includes transaction costs and is net of
cash  acquired  of $30.6  million.  InterTAN is a leading  consumer  electronics
retailer of both  private-label  and brand-name  products with  headquarters  in
Barrie,  Ontario,  Canada.  In addition to giving us a greater  product-sourcing
capability  and  the  ability  to  accelerate  the  offering  of   private-label
merchandise  to our  customers,  the  acquisition of InterTAN gives us our first
presence in the Canadian market.

On May 25, 2004, we completed the sale of our private-label  finance  operation,
comprised of our  private-label  and co-branded  Visa credit card  programs,  to
Chase  Card  Services,   formerly  Bank  One   Corporation.   Results  from  the
private-label  finance operation,  including transition and transaction costs of
approximately  $6 million related to the sale of the operation,  are included in
finance income.  We also entered into a Consumer  Credit Card Program  Agreement
under which Chase Card Services is offering  private-label and co-branded credit
cards  to new and  existing  customers.  As part of the  program  agreement,  we
jointly  develop and  introduce  new  features,  products  and services to drive
additional  sales. We are compensated  under the program  primarily based on the
number of new accounts  opened less  promotional  financing  costs that exceed a
negotiated  base  amount.  Chase Card  Services is  obligated  to offer  special
promotional financing terms to our customers. We determine the frequency, volume
and,  subject  to  certain  limits,  the terms of these  promotions.  Chase Card
Services is compensated for these promotions in accordance with a negotiated fee
schedule.  The program  agreement has an initial  seven-year term with automatic
three-year renewals.  The agreement has customary  representations,  warranties,
covenants,  events of default and  termination  rights for an  agreement of this
type.  The net results from the program  agreement are included in net sales and
operating revenues on the consolidated statements of operations.

CRITICAL ACCOUNTING POLICIES

See the discussion of critical accounting policies under Management's Discussion
and Analysis of Financial Condition and Results of Operations in our fiscal 2005
Annual  Report  on Form  10-K.  These  policies  relate to  accounting  for cash
consideration  received from vendors, the calculation of the liability for lease
termination  costs,  accounting  for  goodwill and other  identified  intangible
assets, accounting for stock-based compensation expense,  accounting for pension
plans and accounting for income taxes.

RESULTS OF OPERATIONS

Our  operations,  in common  with other  retailers  in  general,  are subject to
seasonal  influences.  Historically,  we have realized more of our net sales and
net earnings in the fourth  quarter,  which includes the majority of the holiday
selling  season,  than in any other  fiscal  quarter.  The net  earnings  of any
quarter are seasonally  disproportionate  to net sales since  administrative and
certain  operating   expenses  remain  relatively   constant  during  the  year.
Therefore, quarterly results should not be relied upon as necessarily indicative
of results for the entire fiscal year.

Summary of Segment Performance

Where  relevant,  we have  included  separate  discussions  of our  domestic and
international  segments.  Our  domestic  segment  is  primarily  engaged  in the
business  of  selling  brand-name  consumer  electronics,   personal  computers,
entertainment  software and services in our Superstores and mall-based stores in
the United  States  and via the Web at  www.circuitcity.com.  Our  international
segment is  primarily  engaged in the  business  of  selling  private-label  and
brand-name  consumer   electronics  products  in  Canada  and  via  the  Web  at
www.thesourcecc.ca  and principally  includes the operations of InterTAN,  Inc.,
which we  acquired  in May  2004.  Consolidated  results  include  results  from
InterTAN from the acquisition  date. Prior to the second quarter of fiscal 2005,
we had a third reportable segment,  our finance operation.  The following tables
summarize performance by segment.


                                 Page 12 of 26




SEGMENT PERFORMANCE SUMMARY

                                                  Three Months Ended May 31, 2005
(Amounts in millions)                        Domestic     International    Consolidated
---------------------------------------------------------------------------------------
Net sales and operating revenues.............  $2,115.2       $113.2        $2,228.5
Gross profit.................................  $  512.9       $ 45.0        $  557.9
Selling, general and administrative
    expenses.................................  $  520.9       $ 54.4        $  575.3
Net (loss) from continuing operations........  $   (7.1)      $ (6.0)       $  (13.1)


                                                           Three Months Ended May 31, 2004
(Amounts in millions)                             Domestic     International     Finance    Consolidated
---------------------------------------------------------------------------------------------------------
Net sales and operating revenues...............    $2,072.7         $21.7         $  -         $2,094.4
Gross profit...................................    $  486.1         $ 8.6         $  -         $  494.7
Finance income.................................    $      -         $   -         $5.6         $    5.6
Selling, general and administrative
    expenses...................................    $  494.3         $ 7.9         $  -         $  502.2
Net (loss) earnings from continuing
    operations.................................    $   (9.1)        $ 0.4          $3.5        $   (5.2)
 


Net Sales and Operating Revenues

Consolidated

For the first quarter of fiscal 2006,  our total sales  increased 6.4 percent to
$2.23 billion,  and comparable store sales were unchanged from the prior year. A
store's  sales are included in  comparable  store sales after the store has been
open  for a  full  12  months.  In  addition,  comparable  store  sales  include
Web-originated  sales and sales from  relocated  stores.  International  segment
sales will not be included  in the  company's  comparable  store sales until the
quarter ending August 31, 2005.

Domestic Segment

For the  first  quarter  of fiscal  2006 the  domestic  segment's  net sales and
operating revenues were $2.12 billion,  an increase of 2.1 percent over the same
period last fiscal year.  Comparable  store sales were  unchanged from the prior
year.

A decrease in wireless sales,  principally  driven by a business model change in
the third  quarter of fiscal year 2005,  reduced  the  company's  overall  first
quarter  comparable store sales  calculation by approximately 97 basis points. A
decrease in digital video service sales,  principally driven by a business model
change in July 2004,  reduced the company's  overall  first  quarter  comparable
store sales calculation by approximately 106 basis points.

PERCENT OF DOMESTIC MERCHANDISE SALES BY CATEGORY

                                                     Three Months Ended
                                                           May 31
                                                   2005             2004 
-------------------------------------------------------------------------
Video............................................   42%              42%
Information technology...........................   29               33
Audio............................................   16               13
Entertainment....................................   13               12   
                                                  ----------------------
Total............................................  100%            100% 
                                                  ======================

                                 Page 13 of 26

We produced a single-digit comparable store sales increase for the first quarter
in  the  video  category.   Television   comparable  store  sales  increased  by
double-digits,  led by triple-digit  comparable store sales growth in flat panel
displays.  Growth in television  sales and  double-digit  comparable store sales
growth in digital imaging were partially offset by double-digit comparable store
sales declines in camcorders, DVD players and digital video services.

A  double-digit  comparable  store sales decline in the  information  technology
category in the first quarter was driven by double-digit  comparable store sales
declines in personal computer hardware,  including double-digit comparable store
sales  declines in desktop  computers,  monitors and printers and a single-digit
comparable store sales decline in notebook computers. Comparable store sales for
personal computer accessories were relatively unchanged.

For the first  quarter,  in the  audio  category,  we  produced  a  double-digit
comparable store sales increase.  Triple-digit  comparable store sales growth in
portable digital audio products and  single-digit  comparable store sales growth
in mobile audio  products were  partially  offset by a  double-digit  comparable
store sales decline in home audio products.

In the entertainment  category for the first quarter, we produced a single-digit
comparable  store sales  increase,  reflecting a double-digit  comparable  store
sales  increase  in game  products  and a  single-digit  comparable  store sales
increase in video software,  partially offset by a single-digit comparable store
sales decline in music software.

The following table provides the number of our domestic segment stores:



DOMESTIC STORE MIX

                                               May 31, 2005     Feb. 28, 2005     May 31, 2004
----------------------------------------------------------------------------------------------
Superstores..................................       612              612               602
Mall-based stores............................         5                5                 5     
                                             --------------------------------------------------
Total domestic segment stores................       617              617               607     
                                             ==================================================


In fiscal 2006, we expect to open 30 to 40 Superstores in our domestic  segment,
of which  slightly less than half are expected to be  relocations.  In the first
quarter of fiscal 2006, we relocated three Superstores.

Extended  Warranty  Revenues.  For our  domestic  segment,  the  total  extended
warranty  revenue  included in total sales was $85.1 million,  or 4.0 percent of
domestic  sales,  in the first  quarter  of fiscal  2006,  compared  with  $77.2
million, or 3.7 percent of sales, in last fiscal year's first quarter.

The domestic  segment sells  extended  warranty  programs on behalf of unrelated
third  parties  who are the  primary  obligors.  Extended  warranty  sales carry
higher-than-average gross profit margins.

Net Credit Revenues or Expenses.  In May 2004, we sold our private-label finance
operation to Chase Card  Services.  We entered into an  arrangement  under which
Chase offers  private-label and co-branded credit cards to both new and existing
customers.  Revenues  from  new  account  activations  are  offset  by the  cost
associated with promotional  financing over a predetermined base. The net credit
revenues or expenses  from the program are  included in net sales and  operating
revenues on the  consolidated  statement of operations.  Net credit expenses for
the three months ended May 31, 2005,  were $526,000,  as costs  associated  with
promotional  financing  more than offset revenue  generated  through new account
activations.


International Segment

The international segment's net sales and operating revenues were $113.2 million
for the first  quarter of fiscal 2006,  compared  with $21.7 million from May 12
through May 31, 2004. The international segment consists of

                                 Page 14 of 26

the  operations  of InterTAN,  Inc.,  which  Circuit City  acquired in May 2004.
International  segment  sales will not be included in the  company's  comparable
store sales until the quarter ending August 31, 2005.



INTERNATIONAL STORE MIX

                                              May 31, 2005     Feb. 28, 2005     May 31, 2004
---------------------------------------------------------------------------------------------
InterTAN-owned stores.......................       522              521               509
Dealer outlets..............................       330              331               334
Roger Plus stores...........................        90               88                84
Battery Plus stores.........................        25               26                30     
                                            --------------------------------------------------
Total international segment stores..........       967              966               957   
                                            ==================================================


In addition to the 967 retail stores and dealer outlets open as of May 31, 2005,
the international segment conducts business through 65 wholesale  relationships.
At  February  28,  2005,  the  international  segment  maintained  64  wholesale
relationships, and at May 31, 2004, it maintained 45 wholesale relationships.


Gross Profit Margin

Consolidated

The gross profit  margin was 25.0  percent in the first  quarter of fiscal 2006,
compared with 23.6 percent in the same period last fiscal year. The higher gross
profit margin for the first quarter of fiscal 2006 reflects the inclusion of the
international segment for the full quarter,  improved domestic store merchandise
margin principally due to a lower mix of personal computer  hardware,  increased
domestic  extended  warranty  sales and  increased  efficiency  in our  domestic
product service and distribution operations.  The inclusion of the international
segment contributed 62 basis points to the improvement.

Domestic Segment

For the first quarter of fiscal 2006, the domestic segment's gross profit margin
of 24.3 percent increased 80 basis points from the same period last fiscal year.
The change in the  domestic  gross profit  margin  reflects  increased  extended
warranty sales, which carry  higher-than-average  gross profit margins; improved
store  merchandise  margin  principally due to a lower mix of personal  computer
hardware;  and  improvements  in the  efficiency  of  our  product  service  and
distribution operations.

International Segment

The  international  segment's gross profit margin in the first quarter of fiscal
2006 was 39.7 percent of international sales.

Finance Income

Finance  income was $5.6 million in the three  months  ended May 31,  2004,  and
includes  a  portion  of the  loss  on the  sale  of the  private-label  finance
operation to Chase Card Services and the income  generated by the  private-label
finance operation from the beginning of the fiscal year through the sale date.

Prior  to  November  2003,   both  our  bankcard   finance   operation  and  our
private-label   finance  operation  were  conducted  through  our  wholly  owned
subsidiary,  First North  American  National Bank,  which was a  limited-purpose
credit card bank, and through  consolidated  special  purpose  subsidiaries  and
off-balance-sheet  qualifying  special purpose  entities.  As part of a focus on
strengthening  the  financial  performance  of our  core  business,  we sold our
bankcard  finance  operation to FleetBoston  Financial in November 2003 and sold
our private-label finance operation to Chase Card Services in May 2004.

                                 Page 15 of 26

Results  from the  bankcard  finance  operation  are  presented  as results from
discontinued operation on the consolidated financial statements;  therefore, its
results are not included in the "Components of Finance  Income" table.  See "Net
Loss from Discontinued Operation."

Coincident  with the sale of the  private-label  operation to Chase,  we entered
into an ongoing  arrangement with Chase under which they offer private-label and
co-branded  credit cards to both new and existing  customers.  Results from that
arrangement are included in net sales and operating revenues on the consolidated
statement of operations.

COMPONENTS OF PRETAX FINANCE INCOME

                                                         Three Months Ended
 (Amounts in millions)                                    May 31, 2004        
------------------------------------------------------------------------------
Securitization income..................................        $28.1
Less: Payroll and fringe benefit expenses..............          7.6
        Other direct expenses..........................         14.9          
                                                       -----------------------
Finance income.........................................        $ 5.6          
                                                       =======================

Securitization  income  primarily  is  comprised  of the gain on the sale of the
credit card receivables,  income from the retained  interests in the securitized
receivables and income related to servicing the securitized receivables, as well
as the  impact of  increases  or  decreases  in the fair  value of the  retained
interests.


Selling, General and Administrative Expenses

Consolidated

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

                                           Three Months Ended May 31
                                         2005                   2004
                                              % of                    % of
(Dollar amounts in millions)          $(a)    Sales         $(b)      Sales  
-----------------------------------------------------------------------------
Store expenses.....................  $502.0   22.5%        $457.6     21.9%
General and administrative
     expenses......................    77.4    3.5           43.9      2.1
Remodel expenses...................       -      -            0.1        -
Relocation expenses................     2.0    0.1            1.9      0.1
Pre-opening expenses...............     0.2      -            0.8        -
Interest income....................    (6.3)  (0.3)          (2.1)    (0.1) 
                                   -----------------------------------------
Total  ............................  $575.3   25.8%        $502.2     24.0%
                                   ========================================

(a) Includes international segment store expenses of $34.3 million,  general and
administrative expenses of $20.3 million and interest income of $0.2 million.
(b) Includes  international  segment store  expenses of $6.6 million and general
and administrative expenses of $1.4 million.

Selling,  general and administrative expenses were 25.8 percent of sales in this
year's first quarter compared with 24.0 percent in last year's first quarter.

Of the 184 point  increase  in the  expense  ratio from the prior  year's  first
quarter, the addition of the international segment added 106 basis points.

Domestic Segment

The domestic segment's  expense-to-sales  ratio increased 78 basis points in the
first quarter of fiscal 2006 from the same period last fiscal year. The increase
in the domestic  segment's  ratio for the first  quarter  reflects the impact of
increased rent, occupancy and depreciation expenses of 43 basis points.

                                 Page 16 of 26

As part of our effort to upgrade and evolve our  business,  we are working  with
consultants from Infinitive to capture revenue and margin improvements in fiscal
2006 in our  merchandising  and  marketing  functions.  We are also working with
consultants from Boston Consulting Group, Inc. to develop and execute innovation
initiatives  that will drive the long-term  growth in our  business.  We believe
these  investments  are necessary  and help  position us for long-term  success.
Expenses associated with the aforementioned  consulting services  contributed 23
basis points to the increase in expense-to-sales ratio.

International Segment

The international  segment's selling,  general and  administrative  expenses for
this year's  first  quarter were 48.1 percent of  international  segment  sales.
Included in the  international  segment's  selling,  general and  administrative
expenses are $11.9 million in expenses  associated with the brand  transition in
Canada.  The majority of these  expenses  directly  relates to the write-down of
RadioShack(R)  branded  inventory  as a result of the  ongoing  litigation  with
RadioShack(R).  We expect future expenses  associated  with brand  transition to
primarily relate to incremental advertising.


Stock-based Compensation Expense

Stock-based compensation expense was $3.3 million for the three months ended May
31,  2005,  compared  with $6.0 million for the three months ended May 31, 2004.
The decrease  reflects lower  weighted-average  fair values of recent grants and
the  complete  vesting of grants  during  fiscal  2005 and the first  quarter of
fiscal 2006. The stock-based compensation expense for the three months ended May
31, 2004, includes  compensation costs related to  performance-based  restricted
stock  grants.  Under  the  terms of the  restricted  stock  grant,  vesting  is
contingent  upon our  achieving a targeted  operating  profit  margin for fiscal
2006. During the fourth quarter of fiscal 2005, management determined that it is
unlikely  that the target  will be met and,  as a result,  reversed  the expense
recorded to date.

Income Tax Provision

The effective  income tax rate applicable to results from continuing  operations
was 38.0 percent for the three  months ended May 31, 2005,  and 36.6 percent for
the three months ended May 31, 2004. The increase  reflects the inclusion of the
international  segment for the full three months ended May 31, 2005,  versus the
inclusion  for only 20 days for the three months ended May 31, 2004,  as well as
an increase in the provision for state and local taxes.


Net Loss from Continuing Operations

The net loss from continuing operations was $13.1 million, or 7 cents per share,
in the first quarter  ended May 31, 2005,  compared with $5.2 million or 3 cents
per share, in the first quarter of last fiscal year.


Net Loss from Discontinued Operation

On November 18, 2003, we completed the sale of our bankcard finance operation to
FleetBoston Financial. Results from the bankcard finance operation are presented
as  results  from  discontinued  operation.  The net loss from the  discontinued
bankcard finance operation was $0.7 million for the quarter ended May 31, 2004.


RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting Standards No. 123 (revised 2004),  "Share-Based  Payment."
SFAS No. 123(R) requires companies to record  compensation  expense based on the
fair value of employee  stock-based  compensation  awards.  The  statement  also
requires  that the  compensation  expense be  recognized  over the period during
which the employee is

                                 Page 17 of 26

required to provide  service in exchange for the award.  SFAS No. 123(R) will be
effective for our first quarter of fiscal 2007. We have not yet  determined  the
impact of adopting this standard.

FINANCIAL CONDITION


Liquidity and Capital Resources

Operating Activities

We used net cash of $94.3 million from operating  activities in the three months
ended May 31, 2005, compared with generating net cash from operating  activities
of $108.3  million in the three months  ended May 31,  2004.  The largest use of
cash in the three  months ended May 31, 2005,  was a $72.3  million  decrease in
accrued income taxes due to the payment of taxes.  The generation of cash in the
three  months  ended May 31,  2004,  resulted  from a reduction  in  merchandise
inventory levels and an increase in accounts payable.

Investing Activities

For the three months ended May 31, 2005,  net cash used in investing  activities
was $97.3 million and primarily related to the purchase of investment securities
of $99.6 million.  For the three months ended May 31, 2004, net cash provided by
investing  activities was $180.4 million and primarily  related to cash proceeds
of $472.7 million from the sale of the  private-label  finance  operation partly
offset by the acquisition of InterTAN,  Inc. for $259.1 million, net of acquired
cash of $30.6 million.

Financing Activities

The board of directors has authorized  stock  repurchases of up to $800 million,
of which $359.8 million  remained  available at May 31, 2005. We repurchased 6.1
million  shares  of common  stock at a cost of $96.1  million  during  the three
months ended May 31, 2005. We repurchased  5.8 million shares of common stock at
a cost of $71.1  million  during the same period last fiscal year. As of May 31,
2005, we had repurchased 34.5 million shares of common stock at a cost of $440.2
million. Based on the market value of the common stock at May 31, 2005, the then
remaining $359.8 million of the $800 million  authorization  would allow for the
repurchase of up to  approximately  12 percent of the 183.0 million  shares then
outstanding.

We have a $500 million, four-year revolving credit facility secured by inventory
and accounts receivable.  At May 31, 2005, we had no short-term borrowings under
the facility.  At May 31, 2005,  outstanding  letters of credit  related to this
facility were $61.7 million,  leaving $438.3 million available for borrowing. We
were in compliance with all covenants at May 31, 2005.

Cash, Cash Equivalents and Short-term Investments

At May 31, 2005, we had cash,  cash  equivalents  and short-term  investments of
$798.7  million,  compared  with $1.0 billion at February  28, 2005.  During the
first quarter of fiscal 2006, we used $92.9 million of cash to repurchase common
stock under our stock repurchase authorization. At May 31, 2004, we had cash and
cash  equivalents  of  $990.6  million.  The  year-over-year  change in the cash
balance primarily  reflects the use of $281.7 million to repurchase common stock
under the company's stock repurchase authorization.

Our primary  sources of liquidity  include  available cash,  borrowing  capacity
under  the  credit  facility,   landlord   reimbursements   and   sale-leaseback
transactions. We expect that our primary sources of liquidity will be sufficient
to fund capital expenditures and working capital for the foreseeable future.

FISCAL 2006 OUTLOOK

Our strategy for improving our operations, financial performance and shareholder
value includes the following:
o upgrading processes, systems and talent to improve the core business
o evolving the core business to generate incremental revenues and profits

                                 Page 18 of 26

o innovating to create new businesses,  related to our core business, to produce
  long-term growth

Key  initiatives to upgrade the core business  support our fiscal 2006 financial
outlook and include the following:
o store revitalization program
o promotional and marketing effectiveness
o product transition and pricing management
o best sourcing
o inventory management,  including improved  customer-perceived  in-stock levels
  and reduced net-owned inventory
o collaborative vendor relationships
o information systems  enhancements,  including a new point-of-sale system and a
  company-wide data warehouse,  as well as improved supply chain,  merchandising
  and marketing systems

Key initiatives to evolve the core business include the following:
o portfolio   management  of  merchandise  product   categories,   matching  our
  investments in merchandise product categories with the strategic intent of the
  specific business
o expanded service offerings,  including expanded  technology  services offering
  nationwide, beginning in the second quarter of fiscal 2006
o continued  investment  in Circuit  City brand  awareness  and in Circuit  City
  Direct marketing, ensuring a consistent multi-channel brand
o improved customer experience led by Associate engagement
o reduction  of  performance  gap between  the best and the  poorest  performing
  stores

Key initiatives to innovate include the following:
o win in home  entertainment - be the retail  destination for home entertainment
  products and services
o digital home  services - develop  breakthrough  consumer  electronics  service
  offerings
o multi-channel  - move focus from  transactions  to  relationships  and provide
  solutions to customers wherever they want them

We reaffirm the following financial guidance for fiscal 2006:
o total sales growth of 3 percent to 6 percent,  including  domestic  comparable
  store sales growth in the low single-digit range
o operating margin (earnings from continuing operations before income taxes as a
  percent of sales) of 1.3 percent to 2.3 percent

This outlook is based on the following assumptions:
o growth in the international segment
o 30 to 40 store openings,  of which  approximately  17 to 22 are expected to be
  new stores and 13 to 18 are expected to be relocations
o continued growth in our Circuit City Direct business
o more effective advertising and promotions to drive traffic
o an improved customer experience to increase the close rate
o enhanced customer perceived in-stock levels
o leverage  in  store  expenses  to  be  more  than  offset  by  investments  in
  information  systems and  innovation  and the  inclusion of the  international
  segment for the full year
o expenses related to domestic store relocations of $17 million
o effective income tax rate applicable to results from continuing operations for
  our domestic segment of 37.1 percent and for our international segment of 39.0
  percent

Capital  expenditures,   net  of  landlord  reimbursements  and  sale  leaseback
transactions,  are expected to total  approximately $205 million,  including the
following components:
o $108 million related to information systems
o $69 million related to the opening of 30 to 40 stores
o $20 million related to the international segment

                                 Page 19 of 26

o $8 million related to store, distribution and other expenditures
We expect  that a number of stores may not receive  the  upgraded  point of sale
system until fiscal 2007, which may reduce the anticipated  information  systems
expenditures in fiscal 2006.


Expected Impact of International Segment Litigation

We are engaged in litigation  with  RadioShack(R)  Corporation  regarding  early
termination of the licensing,  merchandising  and  advertising  agreements  with
RadioShack(R). Because of the ongoing legal conflict with RadioShack(R), we have
taken  steps  to  position  our  Canadian   operations  for  continued  success,
regardless  of the  outcome  of this  litigation.  As of June 30,  2005,  we had
re-branded virtually all stores operating under the RadioShack(R) name in Canada
to THE SOURCE BY CIRCUIT CITYSM.

Potential positive impacts of this transition include the following:
o sales benefit from excitement generated by new brand
o discontinuation of payments to RadioShack(R) of royalty and other fees

Potential negative impacts of this transition include the following:
o sales disruption from replacing old brand
o expenses for advertising new brand
o capital  expenditures  and  expenses  for  new  store  signage  and  inventory
  write-downs, which were incurred in the first quarter of fiscal 2006

We  believe  this  litigation  will not have a  material  adverse  effect on our
financial condition or ongoing results of operations for the 2006 fiscal year.

FORWARD-LOOKING STATEMENTS

The provisions of the Private  Securities  Litigation Reform Act of 1995 provide
companies  with a "safe  harbor" when making  forward-looking  statements.  This
"safe harbor"  encourages  companies to provide  prospective  information  about
their  companies  without fear of  litigation.  We wish to take advantage of the
"safe harbor"  provisions  of the Act. Our  statements  that are not  historical
facts, including statements about management's  expectations for fiscal 2006 and
beyond,   are   forward-looking   statements  and  involve   various  risks  and
uncertainties. In most cases, you can identify our forward-looking statements by
words such as "expect,"  "believe,"  "should,"  "may," "plan," "will" or similar
words.

Forward-looking statements are estimates and projections reflecting our judgment
and involve a number of risks and uncertainties  that could cause actual results
to differ  materially  from those suggested by the  forward-looking  statements.
Although  we  believe  that  the  estimates  and  projections  reflected  in the
forward-looking  statements are  reasonable,  our  expectations  may prove to be
incorrect. The retail industry, and the specialty retail industry in particular,
are dynamic by nature and have  undergone  significant  changes in recent years.
Our ability to anticipate and successfully respond to the continuing  challenges
of our industry is key to achieving  our  expectations.  Important  factors that
could cause actual  results to differ  materially  from estimates or projections
contained in our forward-looking statements include the following:
o changes  in the  amount and degree of  competition  and  promotional  pressure
  exerted by current  competitors and potential new competition from competitors
  using either similar or alternative  methods or channels of distribution  such
  as the Internet, telephone shopping services and mail order
o changes  in  general  economic  conditions  including,  but  not  limited  to,
  financial market performance,  consumer credit  availability,  interest rates,
  inflation,  personal  discretionary spending levels, trends in consumer retail
  spending,  both in general and in our  product  categories,  unemployment  and
  consumer sentiment about the economy in general
o the presence or absence of, or consumer acceptance of, new products or product
  features in the merchandise  categories we sell and changes in our merchandise
  sales mix
o the impact of new  products  and product  features on the demand for  existing
  products and the pricing and profit  margins  associated  with the products we
  sell

                                 Page 20 of 26

o significant changes in retail prices for products we sell
o changes in  availability  or cost of financing for working capital and capital
  expenditures, including financing to support development of our business
o the lack of  availability  or access to  sources of  inventory  or the loss or
  disruption in supply from one of our major suppliers
o the impact of inventory and supply chain  management  initiatives on inventory
  levels and profitability
o our inability to liquidate excess inventory should excess inventory develop
o failure to successfully implement sales and profitability improvement programs
  for our Circuit City Superstores, including our store revitalization plan
o our ability to continue to generate  strong sales growth  through our Web site
  and to generate sales and margin growth through expanded service offerings
o the  availability of appropriate real estate locations for relocations and new
  stores
o the cost and timeliness of new store openings and relocations
o the impact to the average  results from  relocated and  incremental  stores as
  stores are added to the relocation base and incremental store base
o consumer  reaction to new store  locations and changes in our store design and
  merchandise
o the extent to which customers respond to promotional  financing offers and the
  types of promotional terms we offer
o our ability to attract and retain an effective  management  team or changes in
  the costs or  availability  of a suitable work force to manage and support our
  service-driven operating strategies
o changes in  production  or  distribution  costs or costs of materials  for our
  advertising
o effectiveness  of  our  advertising  and  marketing  programs  for  increasing
  consumer traffic and sales
o the successful implementation of our customer service initiatives
o the  imposition  of new  restrictions  or  regulations  regarding  the sale of
  products  and/or  services  we sell,  changes  in tax  rules  and  regulations
  applicable  to us or our  competitors,  the  imposition  of new  environmental
  restrictions, regulations or laws or the discovery of environmental conditions
  at current or future locations, or any failure to comply with such laws or any
  adverse change in such laws
o reduced investment returns in our pension plan
o changes in our anticipated cash flow
o whether,  when and in what  amounts  share  repurchases  may be made under our
  stock buyback authorization
o adverse results in significant litigation matters
o impacts from legal proceedings or other contingencies that, while not material
  to the company's financial position or on-going results of operations,  may be
  material with respect to results of operations for a particular fiscal period
o the ultimate outcome of the litigation instituted by RadioShack(R) Corporation
  to  terminate  InterTAN's  right to use the  RadioShack(R)  name in Canada and
  related rights to purchase merchandise through  RadioShack(R),  any associated
  costs,  any  change in  competitive  conditions,  or any  business  disruption
  resulting from the re-branding of InterTAN's  RadioShack(R) branded stores and
  dealer outlets in Canada
o currency  exchange rate  fluctuations  between  Canadian and U.S.  dollars and
  other currencies
o the regulatory and trade environment in the U.S. and Canada
o the disruption of global, national or regional transportation systems
o the  occurrence  of severe  weather  events or  natural  disasters  that could
  significantly damage or destroy stores or prohibit consumers from traveling to
  our retail locations, especially during the peak holiday shopping season
o the  successful  execution of the  initiatives  to achieve  revenue growth and
  increase  gross  profit  margin  underlying  our  projected  2006  results  as
  discussed under "Fiscal 2006 Outlook" in MD&A

We  believe  our  forward-looking  statements  are  reasonable.  However,  undue
reliance should not be placed on forward-looking statements,  which are based on
current expectations.

                                 Page 21 of 26

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a result of the  acquisition of InterTAN,  we are exposed to market risk from
potential changes in the U.S./Canadian currency exchange rates as they relate to
inventory purchases and the translation of InterTAN's financial results.

Inventory Purchases

A portion of  InterTAN's  purchases are from vendors  requiring  payment in U.S.
dollars. Accordingly,  there is risk that the value of the Canadian dollar could
fluctuate  relative to the U.S. dollar from the time the goods are ordered until
payment is made.  InterTAN's  management  monitors  the  foreign  exchange  risk
associated  with its U.S. dollar open orders on a regular basis by reviewing the
amount of such open  orders,  exchange  rates,  including  forecasts  from major
financial institutions,  local news and other economic factors. At May 31, 2005,
U.S. dollar purchase orders totaled  approximately  $30.5 million.  A 10 percent
decline in the value of the  Canadian  dollar  would  result in an  increase  in
product cost of  approximately  $3.0  million.  The  incremental  cost of such a
decline in currency  values,  if incurred,  would be reflected in higher cost of
sales in future periods. In these  circumstances,  management would take product
pricing action, to the degree commercially feasible.

Translation of Financial Results

Fluctuations  in the  value  of the  Canadian  dollar  have a direct  effect  on
reported  consolidated  results due to the  acquisition  of InterTAN.  We do not
hedge against the possible  impact of this risk. A 10 percent  adverse change in
the foreign  currency  exchange rate would not have a significant  impact on our
consolidated results of operations or financial position.

ITEM 4.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the  participation  of the company's  management,
including the chief executive officer and chief financial  officer,  the company
has evaluated the effectiveness of its "disclosure  controls and procedures," as
that term is defined in Rule 13a-15(e) of the  Securities  Exchange Act of 1934,
as amended, as of the end of the period covered by this Quarterly Report on Form
10-Q.  Based  upon  their  evaluation,  the chief  executive  officer  and chief
financial  officer  concluded  that  the  company's   disclosure   controls  and
procedures are effective.

Changes in Internal Controls

There were no changes in the company's internal control over financial reporting
in the  quarter  ended May 31,  2005,  that  have  materially  affected,  or are
reasonably  likely to materially  affect,  the company's  internal  control over
financial reporting.

                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

On March 31, 2004,  Circuit City announced a public tender offer to purchase the
stock of InterTAN.  Circuit City completed the acquisition and InterTAN became a
wholly owned  subsidiary  of Circuit City on May 19, 2004.  Among other  things,
InterTAN  has  operated   retail   consumer   electronics   outlets   under  the
RadioShack(R)  name in Canada under a licensing  agreement  with a subsidiary of
RadioShack(R) Corporation. InterTAN has also operated under two other agreements
with  RadioShack(R)  and its  subsidiaries  ("RadioShack(R)"):  a  merchandising
agreement and an advertising agreement.

After the March 31, 2004 announcement,  RadioShack(R) asserted early termination
of all three agreements under a variety of theories and on a variety of proposed
termination dates. RadioShack(R) asserts that

                                 Page 22 of 26

InterTAN  failed  to pay an annual  fee in  material  breach of the  advertising
agreement  and,  alternatively,  that  a  "without  cause"  termination  of  the
advertising agreement triggers termination of the other agreements.

On April 5, 2004,  RadioShack(R)  filed suit against InterTAN in Tarrant County,
Texas, and amended that suit on April 27, 2004 (the "RadioShack(R) litigation").
InterTAN disputes the various termination scenarios alleged by RadioShack(R) and
is vigorously defending against those claims. InterTAN also has filed claims for
disparagement and unfair business practices against  RadioShack(R).  The parties
argued a RadioShack(R)  motion for partial summary judgment on February 3, 2005.
On March 24,  2005 the court  issued an order on that  motion  stating  that the
three  agreements  were  terminated no later than  December 31, 2004.  Under the
ruling, InterTAN's rights under the three agreements expired June 30, 2005.

Circuit City  continues to believe that  RadioShack(R)  is not entitled to early
termination of the agreements and that InterTAN has substantial  defenses to the
RadioShack(R)  claims.  InterTAN  intends to continue  vigorously  defending the
claims and to exercise  its rights under the  agreements,  as well as any appeal
rights.

Because of the ongoing legal conflict with RadioShack(R),  Circuit City has been
taking  steps  to  position  its  Canadian  operations  for  continued  success,
regardless  of the outcome of this  litigation.  Circuit City believes that this
litigation  will not have a material  adverse effect on the company's  financial
condition or results of operations for the 2006 fiscal year.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides information about common stock repurchases by or on
behalf of the company during the quarter ended May 31, 2005:                 


                                                                                                                       Approximate
                                                                                             Total Number           Dollar Value of
                                                                                               of Shares              Shares that 
                                                                              Average        Purchased as             May Yet Be 
                                                       Total Number            Price        Part of Publicly           Purchased
                                                        of Shares              Paid             Announced                Under
(Amounts in millions except per share data)             Purchased             per Share         Program               the Program* 
------------------------------------------------------------------------------------------------------------------------------------
March 1 - March 31, 2005.........................             -                 $    -                -                   $455.8
April 1 - April 30, 2005.........................           4.1                 $15.73              4.1                   $391.2
May 1 - May 31, 2005.............................           2.0                 $16.11              2.0                   $359.8
                                                     -----------------                      -----------------
Total fiscal 2006 first quarter..................           6.1                 $15.85              6.1      
                                                     =================                      =================

* In  January  2003,  the  company  announced  that the board of  directors  had
authorized the  repurchase of up to $200 million of common stock.  In June 2004,
the  company   announced  a  $200  million  increase  in  its  stock  repurchase
authorization,  raising the repurchase  capacity to $400 million. In March 2005,
the  company   announced  a  $400  million  increase  in  its  stock  repurchase
authorization,  raising the  repurchase  capacity to $800  million.  There is no
expiration  date  under  the  authorization.  At May 31,  2005,  $359.8  million
remained   available   for  share   repurchases   under  the  share   repurchase
authorization.



                                 Page 23 of 26


ITEM 6.  EXHIBITS

    Articles of Incorporation and Bylaws

    3.1  Circuit  City   Stores,   Inc.   Amended  and   Restated   Articles  of
         Incorporation,  effective  February 3, 1997, as amended through October
         1, 2002,  filed as Exhibit 3(i) to the  company's  Quarterly  Report on
         Form 10-Q for the quarter  ended  November 30, 2002 (File No.  1-5767),
         are expressly incorporated herein by this reference.

    3.2  Circuit City Stores,  Inc.  Bylaws,  as amended and restated  April 19,
         2005, filed as Exhibit 3.1 to the Company's  Current Report on Form 8-K
         filed  April 21, 2005 (File No.  1-5767),  are  expressly  incorporated
         herein by this reference.

    Material Contracts

    10.1 Form of Performance Accelerated Restricted Stock Award letter, filed as
         Exhibit 10.1 to the company's Form 8-K filed on June 23, 2005 (File No.
         1-5767), is expressly incorporated herein by this reference.*

    10.2 Form of Time-based Restricted Stock Award letter, filed as Exhibit 10.2
         to the company's Form 8-K filed on June 23, 2005 (File No. 1-5767),  is
         expressly incorporated herein by this reference.*

    10.3 Form of Non-Qualified Stock Option Grant letter, filed herewith.*

    10.4 Circuit City Stores,  Inc.  2003 Stock  Incentive  Plan, as Amended and
         Restated, Effective June 21, 2005, filed as Appendix A to the company's
         Definitive  Proxy  Statement dated May 13, 2005, for the Annual Meeting
         of Shareholders  held on June 21, 2005 (File No. 1-5767),  is expressly
         incorporated herein by this reference.*

    10.5 InterTAN Canada,  Ltd. Stock Purchase  Program,  filed as Appendix B to
         the company's  Definitive  Proxy  Statement dated May 13, 2005, for the
         Annual Meeting of Shareholders held on June 21, 2005 (File No. 1-5767),
         is expressly incorporated herein by this reference.*


    Rule 13a-14(a)/15d-14(a) Certifications

    31.1 Certification  of CEO under Rule 13a-14(a) of the  Securities  Exchange
         Act of 1934

    31.2 Certification  of CFO under Rule 13a-14(a) of the  Securities  Exchange
         Act of 1934

    Section 1350 Certifications

    32.1 Certification  of CEO under  Section 906 of the  Sarbanes-Oxley  Act of
         2002

    32.2 Certification  of CFO under  Section 906 of the  Sarbanes-Oxley  Act of
         2002

    *Indicates management  contracts,  compensatory plans or arrangements of the
    company required to be filed as an exhibit.



                                 Page 24 of 26


                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the company
has duly  caused  this  report  to be signed  on its  behalf by the  undersigned
thereunto duly authorized.


                                  CIRCUIT CITY STORES, INC.
                                  (Registrant)



                                  By:   /s/ W. Alan McCollough                
                                        --------------------------------------
                                        W. Alan McCollough
                                        Chairman and Chief Executive Officer



                                  By:   /s/ Michael E. Foss                   
                                        --------------------------------------
                                        Michael E. Foss
                                        Executive Vice President and
                                        Chief Financial Officer



                                  By:   /s/ Philip J. Dunn                    
                                        --------------------------------------
                                        Philip J. Dunn
                                        Senior Vice President, Treasurer,
                                        Corporate Controller and
                                        Chief Accounting Officer




July 8, 2005


                                 Page 25 of 26


                                  EXHIBIT INDEX

      Articles of Incorporation and Bylaws

      3.1    Circuit  City  Stores,   Inc.  Amended  and  Restated  Articles  of
             Incorporation,  effective  February  3, 1997,  as  amended  through
             October 1, 2002,  filed as Exhibit 3(i) to the company's  Quarterly
             Report on Form 10-Q for the quarter  ended  November 30, 2002 (File
             No. 1-5767), are expressly incorporated herein by this reference.

      3.2    Circuit City Stores, Inc. Bylaws, as amended and restated April 19,
             2005, filed as Exhibit 3.1 to the Company's  Current Report on Form
             8-K  filed  April  21,  2005  (File  No.  1-5767),   are  expressly
             incorporated herein by this reference.

      Material Contracts

      10.1   Form of  Performance  Accelerated  Restricted  Stock Award  letter,
             filed as Exhibit 10.1 to the  company's  Form 8-K filed on June 23,
             2005 (File No. 1-5767),  is expressly  incorporated  herein by this
             reference.*

      10.2   Form of Time-based  Restricted Stock Award letter, filed as Exhibit
             10.2 to the  company's  Form 8-K filed on June 23,  2005  (File No.
             1-5767), is expressly incorporated herein by this reference.*

      10.3   Form of Non-Qualified Stock Option Grant letter, filed herewith.*

      10.4   Circuit City Stores, Inc. 2003 Stock Incentive Plan, as Amended and
             Restated,  Effective  June 21,  2005,  filed as  Appendix  A to the
             company's  Definitive  Proxy  Statement dated May 13, 2005, for the
             Annual  Meeting  of  Shareholders  held on June 21,  2005 (File No.
             1-5767), is expressly incorporated herein by this reference.*

      10.5   InterTAN Canada,  Ltd. Stock Purchase Program,  filed as Appendix B
             to the company's Definitive Proxy Statement dated May 13, 2005, for
             the Annual Meeting of Shareholders  held on June 21, 2005 (File No.
             1-5767), is expressly incorporated herein by this reference.*


      Rule 13a-14(a)/15d-14(a) Certifications

      31.1   Certification  of  CEO  under  Rule  13a-14(a)  of  the  Securities
             Exchange Act of 1934

      31.2   Certification  of  CFO  under  Rule  13a-14(a)  of  the  Securities
             Exchange Act of 1934

      Section 1350 Certifications

      32.1   Certification of CEO under Section 906 of the Sarbanes-Oxley Act of
             2002

      32.2   Certification of CFO under Section 906 of the Sarbanes-Oxley Act of
             2002


      *Indicates management contracts, compensatory plans or arrangements of the
      company required to be filed as an exhibit.

                                 Page 26 of 26