GameStop profits cut in Half in Second Quarter - News/ 4,146 Views
GameStop has released its financial results for the second quarter of its fiscal year, which ended August 3, 2013. Revenue for the quarter reached $1.38 billion, down from $1.55 billion from the same quarter a year ago. Profits dropped by 50 percent to $10.5 million, from $21.0 million.
"Through two quarters, the year has played out as expected," said GameStop CEO Paul Raines. "During this console transition period, our financial results have been supported by the continued growth of our emerging businesses. This strength helped drive a 130 basis point improvement in gross margin rate for the second quarter."
"Of course, excitement continues to build for the upcoming new games and the launch of the PS4 and Xbox One," Raines Continued. "As the global gaming leader, GameStop is uniquely positioned to capitalize on the new, innovative products coming to market."
Mobile sales saw the biggest growth with sales up 121.4 percent to $55.1 million. Digital receipts also grew 17.9 percent to $158.0 million. However, sales of new software, new hardware and used games all decreased. New software sales decreased 9.3 percent $429.8 million, from $473.8 million a year ago. New hardware sales decreased 19.4 percent $147.8 million, from $183.3 million. Used sales declined 6.0 percent to $528.7 million, from $562.3 million.
GameStop expects sales to improve in the third quarter which sees the launch of Grand Theft Auto V. With higher than expected pre-orders for the next generation consoles GameStop is increasing its forecast for the full fiscal year. The earnings per share for the full fiscal year is expected to be between $3.00 to $3.20, which is up from $2.90 to $3.15.