GameStop 1Q net income falls but beats Street
GameStop Corp. said Thursday that its first-quarter net income fell 25 percent as revenue declined, but results at the world's biggest video game retailer surpassed Wall Street's expectations.
The company earned $54.6 million, or 46 cents per share, in the three months that ended on May 4. That's down from $72.5 million, or 54 cents per share, in the same period a year earlier.
Revenue fell 7 percent to $1.87 billion from $2 billion.
Analysts, on average, were expecting earnings of 40 cents per share on revenue of $1.82 billion, according to a poll by FactSet.
GameStop's report comes two days after Microsoft Corp. became the last of the three major video game console makers to unveil its new gaming system, the Xbox One. Though there were rumors to the contrary, gamers will be able to pay used games on the system. This is welcome news for GameStop, which makes money from letting people trade in used games, which it then sells, for credit toward new ones.
For the second quarter, GameStop expects earnings of 1 cent to 7 cents per share. Analysts were forecasting earnings of 8 cents per share.
Shares of GameStop rose 45 cents, or 1.2 percent, to $36.70 in morning trading. They have traded in a range of $15.32 to $39.87.