GameStop Corp. (NYSE: GME) said on Tuesday that its sales and earnings in the fiscal fourth quarter came in lower than expected.
GameStop shares tanked more than 10% in after-hours trading on Tuesday. Including the price action, the stock that has remained volatile in recent months is now exchanging hands at £116 per share. In comparison, GameStop had started the year at a much lower £12.55 per share.
GameStop’s Q4 financial results versus analysts’ estimates
GameStop reported £58.54 million of earnings in the fourth quarter that translate to 87 pence per share. In the same quarter last year, it had earned a much lower 23.27 pence per share. Adjusted for non-recurring items, the retailer posted £65.96 million of earnings for Q4, or 97 pence per share versus the year-ago figure of 92 pence per share.
GameStop said that it generated £1.54 billion of sales in the recent quarter, compared to a higher £1.59 billion last year. The decline in sales, as per the Grapevine-headquartered company, was attributed to store closures due to the ongoing COVID-19 crisis.
According to FactSet, experts had forecast the company to register £1.61 billion of sales in the fourth quarter. Their estimate for adjusted per-share earnings stood at a marginally higher 98 pence. CEO George Sherman said on Tuesday:
“As we look ahead, we are excited by the opportunities that are in front of us as we begin prioritizing long-term digital and E-Commerce initiatives while continuing to execute on our core business during this emerging console cycle.”
In separate news on Tuesday, China’s Tencent Music Entertainment Group said its quarterly revenue saw a 14.3% increase.
Other prominent figures in GameStop’s earnings report
Other prominent figures in GameStop’s earnings report on Tuesday include a 6.5% annualised growth in same-store sales and a 175% year over year increase in digital sales. In comparison, analysts had called for a lower 4.7% growth in the U.S. firm’s quarterly comparable-store sales.
GameStop concluded the financial year with £461.80 million of cash. The American retailer named Jenna Owens (former distribution manager at Amazon) as its new CFO on Tuesday, and Neda Pacifico (former executive at Chewy) as the senior vice president of eCommerce.
GameStop performed massively upbeat in the stock market last year with an annual gain of more than 200%. At the time of writing, the New York Stock Exchange-listed company is valued at £9.22 billion.
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