GameStop Corp. (NYSE: GME) moved its way into the Thanksgiving long weekend on an upbeat note, after the company reported stronger-than-expected results for its third quarter.
The company, based in Grapevine, Texas, reported Tuesday that total global sales increased 1.5% to $1.99 billion (flat in constant currency), resulting in consolidated comparable store sales growth of 1.9% (+0.6% in the U.S. and +4.6% internationally).
A news release also said new hardware sales increased 8.8%, led by demand for Nintendo Switch, and new software sales increased 5.4% driven by a strong title lineup. Pre-owned sales declined 2.4%. Worldwide omnichannel sales increased by 38.6% on the strength of new hardware sales.
GameStop’s third quarter net earnings were $59.4 million, or $0.59 per diluted share, compared to net earnings of $50.8 million, or $0.49 per diluted share in the prior-year quarter.
The third quarter results include a benefit of $6.8 million ($4.3 million, net of tax) related primarily to a reduction of previously accrued contingent purchase price consideration and lease obligations for previously closed stores in the company’s Technology Brands AT&T Wireless business.
Excluding this gain, GameStop's adjusted net earnings for the third quarter were $55.1 million, compared to adjusted net earnings of $50.8 million in the prior-year quarter. Adjusted diluted earnings per share were $0.54 compared to adjusted diluted earnings per share of $0.49 in the prior-year quarter.
The company’s stock rocketed 85 cents, or 5.1%, Wednesday to $17.58.
