GameStop (GME) Stock Is Up 5% Ahead of Q1 Earnings


  • Analysts expect GameStop (GME) to report first-quarter revenue of $1.358 billion, down 1.45% year-over-year (YOY).
  • Adjusted EPS is forecast to be a loss of 12 cents for the period.
  • GME stock is up about 50% year-to-date (YTD).
GameStop (GME) sign on side of building in blue early morning light

GameStop (NYSE:GME) stock is in full focus today, as the video game retailer is set to report its first-quarter earnings after the market close today. An investor conference call will follow shortly after at 5:00 p.m. Eastern.

This meme stock general has defied all the odds and still remains relevant among retail shareholders to this day, despite the stock’s year-over-year (YOY) loss of about 30%. Year-to-date (YTD), shares of GME stock are up by about 50%.

In 2023, GameStop has embarked on a cost-cutting journey in order to achieve profitability. To help with this, the company has exited and winded down some of its business operations in Europe. GameStop also seeks to penetrate relevant higher margin categories, such as collectibles and toys.

“Although there is a lot of hard work and necessary execution in front of us, GameStop is a much healthier business today than it was at the start of our transformation. We plan to build on our momentum while prioritizing value creation and stockholders’ interests,” explained CEO Matt Furlong in a letter to shareholders last month.

GME Stock: GameStop to Report Earnings After the Market Close

Furlong has made it clear that profitability is a major goal for GameStop. However, analysts are forecasting an adjusted first-quarter EPS loss of 12 cents and a GAAP EPS loss of 15 cents. Last quarter, the company reported a surprise profit, posting an adjusted EPS of 16 cents compared to the analyst estimate for a loss of 13 cents. This resulted in GME stock surging higher by about 50%. A surprise EPS beat could have a similar effect this quarter if GameStop is up for the task.

Meanwhile, analysts have forecast revenue of $1.358 billion, which would reflect a year-over-year (YOY) decline of 1.45% and a quarter-over-quarter (QOQ) decline of 38.99%. Shareholders shouldn’t be too worried about the QOQ decline, as seasonality and the holiday season usually lift Q4 sales substantially over all other quarters.

Finally, one of the most important aspects of an earnings report is guidance. GameStop does not usually provide guidance, although analysts are expecting Q2 revenue of $1.155 billion, up by 1.67% YOY. Meanwhile, Q2 adjusted EPS is expected to be a loss of 21 cents.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines. 

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.

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