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GameStop shares plunge in early deals despite seeing increased in festive sales

Hardware sales increased 38.3%, driven the launch of the box One X and strong demand for Nintendo Switch
GameStop shares plunge in early deals despite seeing increased in festive sales
Gamestop said it was pleased with the sales performance..

Fortune 500 video gaming giant GameStop Corp (NYSE:GME) saw shares plunge 7% in early deals despite the group reporting a 10.6% increase in sales for the festive  period compared to the same time in 2016.

Sales of new video game software increased 7.3%, largely due to the success of Activision’s Call of Duty: WWII and the continued strength in Nintendo Switch titles.

Meanwhile,  hardware sales increased 38.3%, driven the launch of the box One X and  strong demand for Nintendo Switch.

But pre-owned sales declined 8.1%, as customers shifted their spending towards new video game and collectibles products.

Video game accessories sales grew a whopping 33.7%, mainly related to demand for Nintendo Switch accessories.

"We are pleased with our sales performance during the important holiday period, driven by strength in the Nintendo Switch and Xbox One X, and a solid increase in our collectibles business," said Dan DeMatteo, interim chief executive.

"Our results demonstrate our customers’ enthusiastic response to new products and our ability to execute on strategically targeted promotions.”

GameStop said it expects to deliver adjusted earnings per share near the middle of its previously announced full-year 2017 guidance of between $3.10 to $3.40.

The company also expects full-year fiscal 2017 comparable store sales to increase between 4% and 6% compared to the comparable 53 week period.

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GameStop Timeline

November 02 2016

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