Successful Wii U launch, strong digital & mobile growth, offset by lower store traffic
Company narrows Q4 guidance range
GRAPEVINE, Texas--(BUSINESS WIRE)--GameStop Corp. (NYSE: GME), the world’s largest multichannel video game retailer, today reported sales results for the nine-week holiday period ended Dec. 29, 2012.
Total global sales for the period were $2.88 billion, a 4.6% decrease compared to the 2011 holiday sales period. Total comparable store sales decreased 4.4%, with U.S. comps of -3.5% and international comps of -6.4%. Based on the holiday sales results, GameStop is narrowing its comparable store sales range for the fourth quarter to -7.0% to -4.0% and the full year to -9.0% to -7.5%.
“GameStop experienced mixed results during the holiday selling period. Our successful Wii U launch, strong digital growth and continued momentum in the mobile space were countered by a decline in store traffic,” said Paul Raines, chief executive officer. “As a result, GameStop expects its fourth quarter 2012 earnings per share results to be at the low end of its current guidance range. Our strong market share positions us well for the future, and we look forward to new product launches in 2013.”
For the holiday period, new hardware sales decreased 2.7%, including the sale of 320,000 Nintendo Wii U units worldwide. Sales of new video game software decreased 5.1% as frontline title releases could not offset a decline in overall store traffic. The pre-owned category declined 15.6% as limited inventory due to fewer new titles released throughout 2012 and less promotional activity negatively impacted sales compared to last year.
Digital receipts increased more than 40.0%, while sales in the mobile business were $76.5 million during the holiday period and have exceeded $160 million year-to-date. Additionally, global e-commerce sales improved 20.5% compared to the 2011 holiday period.
Share Repurchase Update
During the holiday period, GameStop repurchased 458,000 shares of common stock at an average price of $25.51, or $11.7 million worth of stock. As of the end of the holiday period, the company has approximately $488.3 million remaining of its current share repurchase authorization.
GameStop Corp. (NYSE: GME), a Fortune 500 and S&P 500 company headquartered in Grapevine, Texas, is the world's largest multichannel video game retailer. GameStop's retail network and family of brands include 6,650 company-operated stores in 15 countries worldwide and online at www.GameStop.com. The network also includes: www.Kongregate.com, a leading browser-based game site; Game Informer(R) magazine, the leading multi-platform video game publication; Spawn Labs, a streaming technology company; and a digital PC game distribution platform available at http://www.GameStop.com/PC.
General information on 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.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, the outlook for the fourth quarter and fiscal 2012, future financial and operating results, projected store openings, the company's plans, objectives, expectations and intentions, and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of GameStop's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. GameStop undertakes no obligation to publicly update or revise any forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the inability to obtain sufficient quantities of product to meet consumer demand, including console hardware and accessories; the timing of release of video game titles for current generation consoles; the launch of next generation consoles and the features of such consoles; the cyclical nature of the video game industry; the risks associated with international operations and the integration of acquisitions; the impact of increased competition and changing technology in the video game industry, including browser and mobile games and alternative methods of distribution; and economic, regulatory and other events, including litigation, that could reduce or impact consumer demand or affect the company’s business. Additional factors that could cause GameStop's results to differ materially from those described in the forward-looking statements can be found in GameStop's Annual Report on Form 10-K for the fiscal year ended Jan. 28, 2012 filed with the SEC and available at the SEC's Internet site at http://www.sec.gov or http://investor.GameStop.com.
|9 Weeks Ended||9 Weeks Ended|
|Dec. 29, 2012||Dec. 31, 2011|
|Sales||of Total||Sales||of Total|
|Sales (in millions):|
|New video game hardware||$||524.5||18.2||%||$||538.9||17.8||%|
|New video game software||1,393.9||48.4||%||1,469.2||48.7||%|
|Used video game products||530.0||18.4||%||627.9||20.8||%|
VP, Public & Investor Relations