GameStop Corp. (NYSE:GME) shares are slumping on Friday, November 21st after reporting unexpectedly poor third quarter earnings. Shares of the Grapevine, Texas-based game retailer are down more than 10% in premarket trading.
The gaming firm noted that the delayed release of the newest version of the popular game “Assassin’s Creed Unity” had a significant impact on top and bottom line results for the quarter running through November 1st.
Exclusive: York Capital to wind down European funds, spin out Asian funds
York Capital Management has decided to focus on longer-duration assets like private equity, private debt and collateralized loan obligations. The firm also plans to wind down its European hedge funds and spin out its Asian fund. Q3 2020 hedge fund letters, conferences and more York announces structural and operational changes York Chairman and CEO Jamie Read More
Details on GameStop third quarter earnings
The video game retailer reported its earnings after the close on Thursday, with third quarter adjusted earnings coming in at $0.57, missing Wall Street analyst consensus estimate of $0.60.
Third quarter revenue also came in light at $2.09 billion, missing consensus analyst expectations for around $2.2 billion. Also of note, comparable stores sales declined by a worrisome 2.3% in the third quarter.
Statement from GameStop CEO
In a statement released after the the firm’s third quarter earnings release, GameStop CEO Paul Raines said: “Overall, most of our major product categories performed very well, but our third quarter results were impacted by Assassin’s Creed Unity moving out of October.”
Fourth quarter and full year guidance also disappointing
GameStop Corp. (NYSE:GME)’s guidance for the fourth quarter was also well below analyst expectations, with the firm now saying it expects comparable store sales in 4Q to end up between -5% and +2%.
Furthermore, the firm has indicated that it expects profit in the fourth quarter to end up somewhere around $2.08-$2.24 per share, well below the $2.28 per share expectations on Wall Street.
The company also noted in its report today that it does expect to meet its earlier profit forecasts for the full year, with GameStop management now saying earnings in fiscal 2014 are likely to come in at $3.40-$3.55 per share, again significantly below the $3.68 per share currently expected by sector analysts.