GameStop Corp. (NYSE:GME) shares are trading higher after the world’s largest multi-channel video game and entertainment software retailer reported earnings results for the first quarter that outperformed the expectation of Wall Street analysts. The stock price of GameStop Corp. (NYSE:GME) jumped more than 3% to $38.10 per share during extended hours trading around 4:30 p.m. in New York.
Financial results
The video game and entertainment software retailer posted earnings of 59 cents per share, higher than the 57 cents per share forecast by analysts. GameStop Corp. (NYSE:GME) said its revenue rose 7% to $2 billion, slightly lower than the $2.03 billion consensus estimate. According to the company, its consolidated comparable store sales increased 5.8%.
GameStop Corp. (NYSE:GME) said consumer demand for Microsoft Corporation’s (NASDAQ:MSFT) Xbox One and the PlayStation 4 from Sony Corp (ADR) (NYSE:SNE) remained strong worldwide. The retailer cited that as the primary reason for its strong quarterly financial performance. Sales in its new hardware category rose 81.1% from last year. According to the company, its new software sales during the quarter declined 20.4% due to fewer AAA titles, while sales of pre-owned / value software increased 5.3% year-over-year.
Paul Raines, CEO of GameStop Corp. (NYSE:GME), said, “I am pleased to report solid financial and operational results in the first quarter. The next-gen console business is meeting our targets, our digital properties continue to grow and our new tech brands segment is positively contributing to our profitability.”
Raines added that GameStop Corp. (NYSE:GME) is well-positioned to achieve growth from its diversified business segments, including gaming, mobile wireless, and consumer electronics.
During the quarter, the company repurchased 1.33 million shares at an average price of $39.28 per share (adding up to a total value of $52.2 million). It has $405 million remaining on its stock buyback authorization. GameStop Corp. (NYSE:GME)’s board of directors also approved a quarterly dividend payment of 33 cents per share, payable on June 17, 2014.
