GameStop Tops Q2 Profit Forecast, Warns on Weaker Q3

The game retailer may take an accounting charge in this quarter

   

GameStop Tops Q2 Profit Forecast, Warns on Weaker Q3

GameStop (NYSE:GME) announced on Thursday that it earned $21 million during the second quarter, down 32% from $30.9 million in the same period last year.

The video-game retailer said that sales fell to $1.55 billion, down 11.1% from 2011. That missed the $1.60 billion in sales that Wall Street was looking for, Reuters noted.

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EPS for the quarter was 16 cents, which narrowly beat the 15 cents that analysts had predicted. Shares of GameStop rose about 2% in Thursday morning trading.

The company also warned of soft sales during the current quarter due to a lack of new top-line game titles. It forecasts third-quarter earnings of between 28 cents and 36 cents a share, as same-store sales fall by between 5% and 10%.  The retailer also indicated that it might take charges related to its overseas accounting during the quarter.

That disappointed analysts who expected earnings of 41 cents a share for the current quarter.

Vendors of traditional PC and console game titles have experienced rising competition from online and app-based games for mobile devices like Apple‘s (NASDAQ:AAPL) iPhone and iPad and tablets and smartphones running Google‘s (NASDAQ:GOOG) Android operating system.

Sales of video-game consoles and accessories fell 20% last quarter, while gaming software sales dropped 23%.


Article printed from InvestorPlace Media, http://investorplace.com/2012/08/gamestop-tops-q2-profit-forecast-warns-on-weaker-q3/.

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