GameStop lost USD215 million in fiscal year, online sales gain

AP – GameStop, the video game retailer at the centre of a social-media driven investment frenzy, said it lost USD215 million in the 12 months ended on January 30 as it dealt with pandemic-related shutdowns and moved to transform itself into a more online-focussed company.

The company’s latest results, which fell short of Wall Street’s expectations, offered few positives to back up some investors’ belief that the struggling retailer is on track to turn its business around and perhaps justify its stock’s stunning run from around USD20 a share at the start of the year to north of USD480 by the end of January.

GameStop touted that global e-commerce sales made up 34 per cent of net sales in the fourth quarter compared with 12 per cent in the year-ago quarter. It also noted a 6.5 per cent gain in sales at stores open at least a year, a key retail industry metric.

But there was less encouraging news as well: GameStop announced it would suspend earnings guidance as it focusses on its bid to bring more of its business online. And, in a break with the Wall Street norm, Chief Executive Offficer George Sherman didn’t take any questions from analysts during a post-earnings release call. Sherman did not address the recent volatility in the company’s shares in his remarks.

GameStop shares were little changed in after-hours trading. They fell 6.6 per cent to USD181.75 in the regular trading session and are still up about 864 per cent this year.

The Grapevine, Texas, company reported net income of USD80.5 million, or USD1.19 per share, for the three months ended January 30. That compares with net income of USD21 million, or 32 cents per share, a year earlier.

A man walks past a GameStop storefront in Dallas. PHOTO: AP