GameStop Buys Back a Crazy Amount of Stock
Video game retailer GameStop (NYSE: GME) released its third-quarter 2019 earnings report after the bell on Tuesday, and the market reaction was swift and brutal. As of this writing, shares are down 15% in after-hours trading, and it's not hard to figure out why.
In the quarter, sales plunged 25.7%, and net losses were $40.2 million, excluding a $43 million noncash impairment charge. This was much worse than the 13.4% consensus revenue decline anticipated by analysts. The company also lowered its full-year EPS guidance to just $0.10 to $0.20, down from the previous range of $1.15 to $1.30.
New hardware sales plunged 43.4% and new software sales fell 32.6%, as customers are likely waiting for next year's new consoles from Sony's PlayStation and Microsoft's Xbox. The company did report growth in Nintendo Switch products, but it wasn't enough to offset the declines from the two other main game vendors. In addition, GameStop is under pressure from more video gaming going to digital streaming formats.
Source Fool.com
