GameStop Narrowly Surpasses Quarterly Expectations

GameStop Corp. narrowly topped reduced expectations late Tuesday, after issuing a profit warning earlier this month. The retailer reported net income of $50.8 million, or 49 cents a share, compared with $56 million, or 54 cents a share, in the year-earlier period. On Nov. 2, the company warned that both its quarterly and full-year earnings would be weaker than previously forecast. Revenue fell 3% to $1.96 billion from $2.02 billion a year ago, while same-store sales, a key growth metric for retailers, fell 6.5%. Analysts surveyed by FactSet were calling for earnings of 47 cents on sales of $1.98 billion. New hardware sales plummeted 20.6%, which the company blamed on "weaker-than-expected demand during the last few weeks of October." The declines were partially offset by stronger sales in its technology brands and collectibles category, the latter of which was propped up by demand for Pok�mon items. The company expects same-store sales to fall between 12% and 7% in the current quarter, and earnings to be in the range of $2.23 to $2.38 a share, compared with the FactSet consensus estimate of $2.36. Shares of GameStop have declined by 23% in the past three months and nearly 40% in the past year. The S&P 500 , by comparison, has risen 1% in the past three months and 5.5% in the past year.