GameStop confirmed rumors that it was "engaging with third parties regarding a potential transaction" in conjunction with its earnings announcement Thursday. Exploration of a potential sale of the company is "part of a comprehensive review of strategic and financial alternatives initiated by the company’s board of directors, "the company said. Operating with an interim CEO, the company said it will not have a permanent CEO until the strategic review is completed.
Meanwhile, the company’s results for its fiscal second quarter ended August 8 were in line with expectations overall, with continued strong sales for the collectibles category.
Comp store sales were up 2.4% in the U.S. and down 6.4% internationally, bringing total sales down 2.4% to $1.65 billion. Profits swung negative to a net loss of $24.9 million vs. net income of $22.2 million in the year ago period, due in part to a special $29.6 million charge for taxes related to a French audit.
Collectible sales were up 15.7% to $141.7 from $122.5 in the same quarter a year ago, with 35% growth in apparel sales, now the second largest collectibles subcategory behind toys, driving the increase. Changing of store displays will give "much greater prominence" to new video game merchandise, the company said in the conference call.
As was the case last quarter, the number of collectibles stores stayed stable at 103, with the number of video game stores in the U.S. down slightly to 2802.
There was no mention in the earnings report or the conference call of collectibles subcategories tabletop games or comics, which are currently in test (see "GameStop Sees Opportunity To Be ‘Nationwide Partner with Diamond’").
As Merch Sales Continue to Grow
Posted by ICv2 on September 7, 2018 @ 2:46 am CT