GameStop to expand technology brands segment with 350 to 550 stores

Grapevine, Texas -- GameStop on Thursday said it plans to open between 350 to 550 stores in its technology brands segment (whose banners include Simply Mac, Cricket and Spring Mobile, which sells post-paid AT&T services and wireless products through its 358 AT&T branded stores) while closing about 3%, some 200, of its 6,000 GameStop video locations in 2015.



The news came as the chain posted mixed results for the fourth quarter. Net earnings on an adjusted basis were $235.5 million compared to adjusted net earnings of $222.4 million in year-ago period.



Total global sales for the quarter declined 5.6% to $3.48 billion. Mobile, consumer electronics and new software all had gains, but the increases were offset by a decrease in new hardware sales. Same-store sales fell 1.8%.



However, digital sales rose 41.4% to $368.8 million during the quarter, fueled by downloadable content and mobile digital sales.



“In our core video game business, we achieved our highest market share in history with 28% share of next-generation hardware, 46% share of next-generation software and an estimated 42% share of downloadable content,” said GameStop CEO Paul Raines. “Meanwhile, our Technology Brands segment exceeded expectations, contributing 5% to our operating income and to our highest-ever annual gross margin of 29.9%, as we rapidly expanded the footprint of our AT&T wireless and Apple retail businesses.”



For the full year, GameStop sales were $9.3 billion, compared to $9.04 billion last year. Consolidated comparable store rose 3.4%. Total net earnings for the year were $393.1 million, compared to $354.2 million last year.