GameStop unclear about holiday sales

GameStop forecast an exceptionally wide range of same store sales possibilities during the fourth quarter following weaker than expected third quarter results.

GameStop said it expects its fourth quarter same store sales to range from a 1% decline to a 6% increase. While that range of possibilities might seem wide compared to retailers in other sectors, GameStop offered an equally wide range last year. The company recorded a 1.8% decline in the fourth quarter same store sales last year after providing guidance that called for a 5% decline to a 2% increase.

Sales declined 3.6% to slightly more than $2 billion during the third quarter ended Oct. 31. Same store sales declined 1.1% during the quarter on top of a prior year third quarter decline of 2.3% decline. Net income declined 11.4% to $57 million and earnings per share declined 5.3% to 54 cents.

“Our third quarter results were at the low end of our guidance range due to lower than expected new software and hardware sales and delays in Technology Brands store openings,” said GameStop CEO Paul Raines. “However, our expectations for the full year have not changed. Looking ahead to the fourth quarter, a solid slate of new video games, coupled with contributions from our diversified AT&T, Apple and ThinkGeek businesses and our in-store collectibles offerings are expected to drive our fourth quarter results.”

The company maintained its full year profit forecast which calls for earnings per share in the range of $3.66 to $3.86.

GameStop ended the quarter with roughly 6,900 stores in 14 countries. The companies Technology Brands segment includes 76 Simply Mac stores, 71 Cricket branded stores and 687 AT&T branded stores.