GameStop Misses Estimates on Lower-Than-Expected Video Game Sales

GameStop Corp, the world's largest video game and gaming console retailer, reported a lower-than-expected quarterly profit on Thursday due to lower sales of video game software at its outlets.

Shares of the company fell about 5 percent to $14.43 (roughly Rs. 1,040) after the bell on Thursday.

Net sales from the video game software business fell 18.5 percent to $300.9 million (roughly Rs. 2,160 crores).

GameStop said its comparable store sales fell 0.5 percent in the quarter. Analysts, on average, had expected a 3.5 percent drop in same store sales, according to Thomson Reuters I/B/E/S.

Excluding items, GameStop earned 5 cents (roughly Rs. 3.6) per share. Analysts had expected a profit of 8 cents per share.

Total sales during the quarter fell 2.4 percent to $1.65 billion (roughly Rs. 11,800 crores), ahead of analysts estimate of $1.62 billion.

GameStop also said that it continues to engage with third parties regarding a possible deal, that may include a sale of the company.

The company said it has been working with Perella Weinberg Partners LP as financial advisor and Sullivan & Cromwell LLP and Pepper Hamilton LLP as legal advisers to assist in the strategic and financial review process.

The company reported a net loss of $24.9 million or 24 cents per share, in the second quarter ended August 4, compared with a profit of $22.2 million, or 22 cents per share a year earlier.

© Thomson Reuters 2018