GameStop Corp. (NYSE: GME), a family of specialty retail brands that makes the most popular technologies affordable and simple, today reported sales and earnings for the second quarter ended August 2, 2014.
Second Quarter Results
Global sales for the second quarter were $1.73 billion, a 25.1% increase compared to $1.38 billion in the prior year quarter. Consolidated comparable store sales increased 21.9%.
New hardware sales increased 124.8%, as demand for Microsoft’s Xbox One and Sony’s PlayStation 4 remains very high. New software sales grew 15.6% and the pre-owned/value category saw positive growth, 5.5%, for the second consecutive quarter.
Sales in the mobile & consumer electronics category rose 85.1%, led by the strong results of Spring Mobile and Simply Mac. The Technology Brands segment contributed 19% of the company’s second quarter’s operating profit.
Non-GAAP digital receipts increased 17.6% to $179.2 million, or $52.3 million of sales on a GAAP basis, led by strong platform currency, mobile and global Steam Wallet sales.
Global multichannel sales advanced 49.3% as customers utilized all of the channels GameStop offers to purchase video gaming and mobile electronic products.
GameStop’s net earnings for the second quarter were $24.6 million, a 134.3% increase compared to net earnings of $10.5 million in the prior year quarter. Diluted earnings per share were $0.22, a 144.4% increase compared to diluted earnings per share of $0.09 in the prior year quarter.
Capital Allocation Update
During the second quarter, the company repurchased 1.90 million shares, or $75.5 million of stock. There is now $329.4 million remaining on the existing repurchase authorization.
GameStop’s board of directors also declared a quarterly cash dividend of $0.33 per common share payable on September 16, 2014, to shareholders of record as of the close of business on September 3, 2014.
Earnings Guidance
For the third quarter of fiscal 2014, GameStop expects comparable store sales to range from +1.0% to +5.0%.
Diluted earnings per share are expected to range from $0.58 to $0.64.
For fiscal year 2014, the company is maintaining its previously announced full year diluted earnings per share guidance range of $3.40 to $3.70. Full year comparable store sales are expected to range from +6.0% to +12.0%.
Note: Current guidance only includes the effect of the shares repurchased thus far in fiscal 2014.
Conference Call Information
A conference call with GameStop Corp.’s management is scheduled for August 21, 2014 at 4:00 p.m. CDT to discuss the company’s financial results. The phone number for the call is 1-888-208-1507 and the pass code is 8853550. This call can also be accessed at GameStop Corp.’s investor relations home page at http://investor.GameStop.com/.
About GameStop
GameStop Corp. a Fortune 500 company, is a global, multichannel video game, consumer electronics and wireless services retailer. GameStop operates more than 6,600 stores across 15 countries.
General information about GameStop Corp. can be obtained at the company´s corporate website. Follow GameStop on Twitter @ www.twitter.com/GameStop and find GameStop on Facebook @ www.facebook.com/GameStop.
