GameStop Pauses Bullish Share Perspective
GameStop Corp. (NYSE:GME) has again lowered its same-store sales outlook for the year as plummeting sales of new hardware influenced results over the holidays.
The video-game retailer now predicts same-store sales to fall one to two percent for the year, down from its reduced November guidance of flat to down 1 percent, though it stood behind its full-year and fourth-quarter earnings guidance.
GameStop said its holiday same-store sales fell 0.3 percent as a 1.5 percent decline internationally exceeded the 0.3 percent rise in the U.S. Total sales were $3.02 billion, essentially flat with the same period last year.
The company reported a 20 percent drop in hardware sales for the nine weeks ended Dec. 31 as there were no new consoles to energize consumer demand as in 2010. At the same time, sales of new video game software was up 9.9 percent and digital sales rose 60 percent, driven by subscriptions for downloadable content like Call of Duty Elite. Sales of pre-owned items grew 3.5 percent.
Here’s how GameStop shares are reacting to the news:
GameStop Corp. (NYSE:GME): GME shares recently traded at $23.91, down $0.96, or 3.86%. They have traded in a 52-week range of $18.34 to $28.66. Volume today was 4,280,018 shares versus a 3-month average volume of 3,366,550 shares. The company’s trailing P/E is 8.58, while trailing earnings are $2.79 per share.