GameStop Corp. (NYSE: GME) released fiscal second-quarter financial results after markets closed Tuesday. The video game retailer said that it had a net loss of $0.32 per share and $1.3 billion in revenue, compared with consensus estimates that called for a net loss of $0.21 per share and $1.34 billion in revenue. The same period from last year had a net loss of $0.10 in per share and $1.65 billion in revenue.
During the second quarter, total global sales decreased by 14.3% (13.1% in constant currency) to $1.3 billion, resulting in a consolidated comparable store sales decrease of 11.6%.
In terms of its segments, the firm reported:
- New video game hardware net sales decreased 41% year over year to $175.6 million.
- New video game software net sales decreased 5% to $285.0 million.
- Pre-owned and value video game products net sales decreased 17% to $373.1 million.
- Video game accessories net sales decreased 9% to $169.6 million.
- Digital net sales decreased 10% to $36.3 million.
- Collectibles net sales increased by 21% to $171.8 million.
Looking ahead to the 2019 fiscal full year, the company expects to see EPS in the range of $1.15 to $1.30 and a comparable store sales decline in the low-teens. Consensus estimates are calling for $1.48 in EPS and $7.4 billion in revenue for the fiscal full year.
George Sherman, GameStop’s CEO, commented:
We are committed to acting with a sense of urgency to address the areas of the business that are critical to achieving long-term success and value creation for all our stakeholders. We will set GameStop on the correct strategic path and fully leverage our unique position and brand in the video game industry. Our strategic plan is anchored on four tenets which include, optimizing the core business by driving efficiency and effectiveness, creating the social and cultural hub of gaming within each GameStop, building compelling digital capabilities, and transforming our vendor and partner relationships for an evolving video game industry. This is a compelling new strategic vision for the company, and we’ve already started to execute against all four pillars. We also remain committed to returning capital to shareholders and balancing that opportunity against the need to maintain a strong balance sheet to properly run our business and invest in responsible growth.
Shares of GameStop closed Tuesday at $5.09, with a 52-week range of $3.15 to $17.04. The consensus analyst price target is $5.64. Following the announcement, the stock is down 12% at $4.44 in the after-hours trading session.
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