GameStop Sees Sales Growth, Profits Down

Representatives from U.S. video game chain GameStop have announced details of the company’s fourth quarter financial results, in which profits fell by 13 percent, although the yearly sales trend was still upward. During the fourth quarter the company saw revenues of $34.5 million in the three months ended January 29th, down from $39.6 million the previous year. Sales rose 13 percent to $708.7 million, from $625.4 million a year earlier, nonetheless below analysts' expectations. Following similar changes at other retailers, GameStop has altered its method for store lease accounting, with changes from previous figures impacting on the fourth quarter profits. For the full year, GameStop's profit slipped 4 percent to $60.9 million, down from $63.5 million the previous year. Sales increased 17 percent to $1.84 billion from $1.58 billion, as same-store sales grew 1.7 percent. Video game software sales rose 22 percent from 2003. In keeping with many retailers and publishers, GameStop chairman and CEO R. Richard Fontaine blamed hardware shortages of the PlayStation 2 and Xbox for much of the problems during the fourth quarter. The company is now predicting same-store sales growth of between 5 percent and 7 percent in the first quarter, and a total sales increase of between 15 percent and 20 percent over the whole year.