GameStop Software Sales Surge Up 36 Percent

Representatives from U.S. video game retail chain GameStop have reported the company’s earnings for the third quarter ended October 30. During this period sales increased 28 percent compared to the same period in 2003, to $416.7 million. Video game software sales grew an extremely promising 36 percent, and hardware sales increased by a similarly decent 11.8 percent. Excluding an after-tax charging relating to the spin-off of common shares previously owned by Barnes & Noble, the company reported earnings of $13.8 million, or $0.24 per diluted share - an increase of 29 percent from last year. According to chairman and CEO R. Richard Fontaine: "Nearly every new game released during the quarter exceeded our expectations, showing the overwhelming demand for video game products and how our new and used model helps us to grow market share and customer demand. The launch of the new PStwo in early October, coupled with the late October launch of the Xbox holiday bundle, drove hardware sales far beyond our original projections." The company also mentioned that GameStop had a record-breaking sales day on November 9th with the release of Halo 2. In addition to GameStop surpassing its largest overall sales day in history, Halo 2 sold over 525,000 units in 24 hours in GameStop stores alone, setting a new record for single title sell-through on one particular day. In anticipation of a busy Christmas period, the company, who also owns Game Informer magazine, is raising guidance for the fourth quarter, with an increase of comparable stores sales between 6 and 9 percent. Full year 2004 earnings guidance was also increased to between $1.28 and $1.31 per diluted share, before one-time charges, due to these promising results.