GameStop Ups Q4 Profit 49%28 Mar, 2013 By: Erik Gruenwedel
Nation’s largest video game retailer posts $270 million fiscal-year loss underscoring ongoing challenges to the console business
GameStop March 28 surprised analysts reporting fourth-quarter (ended Feb. 2) net income of $261.1 million, an increase of 49% from net income of $174.7 million during the previous-year period (ended Jan. 28).
For the fiscal year, GameStop reported a $270 million loss on revenue of more than $8.8 billion, compared with profit of $340 million on sales of $9.5 billion last year.
Grapevine, Texas-based GameStop, which operates more than 6,000 stores globally, attributed an extra week in the quarter compared to last year invested and investments in its mobile and digital businesses for the turnaround.
Fourth-quarter sales were essentially flat at $3.5 billion, which included 60% growth in digital sales and $100 million of mobile sales, offsetting weakness in the core console and packaged media business.
New hardware sales dipped 1.2% to $616.7 million, while new game sales dropped 3% to $1.6 billion. Used game sales fell 8% to $584.3 million.
“While 2012 was a challenging year for console gaming, we focused on factors within our control,” CEO Paul Raines said in a statement. “We expanded our market leadership position, maintained our financial strength and controlled our spending.”