Game Stop continues to explore alternatives—including possible sale

9/7/2018
GameStop reported mixed results for its second quarter and confirmed it is considering a potential sale of the company.

The videogame retailer beat the Street on revenue, but its earnings missed estimates. It also said it is engaging with third parties “regarding a possible transaction” as part of a review of strategic and financial alternatives that was initiated by the company's board.

“As our teams prepare for a busy and exciting holiday period, our board of directors, with the support of our financial and legal advisors, continues to conduct a comprehensive review of strategic and financial alternatives, including, but not limited to, a potential sale of the company,” said Dan DeMatteo, executive chairman of GameStop’s board of directors.

GameStop reported a net loss of $24.9 million, or 24 cents, for the period ended Aug. 4, compared with net income of $22.2 million, or 22 cents, in the year-ago period. Adjusted earnings per share fell to 5 cents from 15 cents. Analysts tracked by FactSet expected 8 cents a share.

Revenue fell 2.4% to $1.65 billion, but was still ahead of the $1.62 billion analysts were projecting. Digital sales increased 15.3% to $255.9 million, excluding the second quarter 2017 revenues from Kongregate, which was sold in July 2017.

The company reiterated its full-year outlook, which calls for total a total sales decline of 2% to 6%. It also reiterated its previous annual earnings-per-share guidance of between $3.00 and $3.35. Analysts were expecting $3.11 per share.

GameStop operates over 7,100 stores across 14 countries.
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