GameStop Tops Q2 Profit Forecast, Warns on Weaker Q3

The game retailer may take an accounting charge in this quarter

   

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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