GameStop Reports a Decline in Earnings for the Second Quarter of 2017
Video game retailer GameStop has released its sales and earnings for the second quarter ended July 29, 2017, reporting an increase in new hardware sales but an overall decrease in profit from the same period last year.
The increase of 14.8 percent in new hardware sales was driven by a strong Nintendo Switch demand but this was offset by a decline in new software and pre-owned sales alongside “lagging” Xbox One sales. While new software sales declined by 3.4 percent year-on-year, pre-owned sales declined by 7.5 percent from the same period last year.
Thanks to mobile and downloadable content, however, GameStop’s digital sales grew by 28.1 percent to $46.5 million.
Elsewhere, the retailer noted that its sale of the Kongregate business to nordic firm MTG resulted in a gain of $7.3 million in the second quarter of 2017. This, alongside Nintendo Switch sales, contained the decline in GameStop’s earnings, which stood at $22.2 million compared to $27.9 million during the same period last year.
CEO Paul Raines said in a statement:
Our second quarter sales results were driven by continued strong demand for Nintendo Switch and Collectibles. Looking at the second half of 2017, the Nintendo Switch, the launch of Microsoft’s Xbox One X, and a solid slate of AAA titles should drive growth in the video game category. In addition, we expect that our Technology Brands AT&T Wireless business will benefit from a boost in consumer demand driven by the launch of innovative new mobile handsets, including Apple’s next-generation iPhone.
You can find the full report over on GameStop’s website.