TSX up after index logs fresh record high close
Investing.com -- GameStop shares popped 8% in premarket trading Wednesday after the company beat Wall Street expectations for the second quarter, reporting stronger sales and swinging to a profit, helped by robust sales in its hardware and collectibles unit.
The video game retailer posted earnings of 25 cents per share, above analysts’ average estimate of 16 cents.
Revenue rose to $972.2 million from $798.3 million a year earlier, topping expectations of $823.3 million.
Operating income came in at $66.4 million, compared with a loss of $22 million a year earlier, as selling, general and administrative expenses fell to $218.8 million from $270.8 million.
Net income surged to $168.6 million from $14.8 million in the same period last year. Excluding one-off items, adjusted net income was $138.3 million, up sharply from $5.2 million.
GameStop, once a powerhouse in brick-and-mortar retail, has shifted focus toward digital sales as online rivals like Amazon have taken market share.
The company is leaning on partnerships with publishers to offer exclusive games and merchandise, including a collectors edition of “Borderlands 4,” to draw customers to both stores and online platforms.
Collectibles have become a key driver, with sales jumping 63% in the second quarter.
Hardware and accessories also saw strong momentum, climbing 31% to $592.1 million, helped by demand tied to Nintendo’s Switch 2 launch and a robust pipeline of new game releases that has boosted interest in existing consoles like the PlayStation 5 and Xbox Series X/S.
The company ended the quarter with $8.7 billion in cash, cash equivalents and marketable securities, compared with $4.2 billion a year earlier.
Its bitcoin holdings were valued at $528.6 million at quarter-end.
(Pratyush Thakur contributed to this report.)