Why Shares of GameStop Tumbled Today
Shares of video game retailer GameStop (NYSE: GME) slumped on Friday following the release of the company's mixed second-quarter report. While total sales rose due to strong demand for the Nintendo Switch, adjusted profits tumbled, missing analyst expectations. As of 11:48 a.m. EDT, the stock was down 12.7%.
GameStop reported second-quarter revenue of $1.69 billion, up 3.4% year over year and $50 million higher than the average analyst estimate. New hardware sales rose 14.8% year over year to $248.4 million, driven by the Switch, while new software sales dropped 3.4% to $369.3 million and pre-owned sales fell 7.5% to $501.8 million. Comparable-store sales growth was 1.9%, and digital sales grew 28.1% to $46.5 million. Outside of games, collectibles sales soared 36.1% to $122.5 million, and technology brands sales rose 7% to $188.3 million.
The Nintendo Switch drove GameStop's revenue higher during the second quarter. Image source: Nintendo.
Source: Fool.com
Gamestop Corp. Stock
Our community is currently low on Gamestop Corp. with 3 Buy predictions and 10 Sell predictions.
A target price of 7 € results in a potential of -61.29% which would mean heavy losses compared to the current price of 18.08 € for Gamestop Corp..
