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GameStop posts record third-quarter results, expects slower fo(Dallas Morning News, The (KRT) Via Thomson Dialog NewsEdge) Nov. 21--GameStop Corp. found itself the victim of its own success Tuesday, reporting record third-quarter results but delivering a slightly weaker fourth-quarter outlook than some analysts had hoped for. Shares of the Grapevine-based video game retailer lost $1.98, or 3.7 percent, to close at $51.01. That was up from nearly a 10 percent decline earlier in the day. In the third quarter, GameStop, the largest stand-alone game retailer, said total sales reached $1.61 billion, up almost 60 percent from $1.01 billion a year ago. That translated to a profit of $52 million, or 31 cents per share, compared with $13.6 million, or 9 cents per share, in the third quarter of 2006. Chairman and chief executive Richard Fontaine said GameStop continues to grow. "During the quarter, we opened 181 stores worldwide, surpassing the 5,000-store milestone, and believe that there are many more opportunities for additional store growth," he said in a statement. "Altogether, all signs point towards GameStop having a strong fourth quarter and robust 2007." Not quite strong enough for some investors, though. Fourth-quarter earnings per share are expected at 95 to 97 cents, higher than the 81 cents per share recorded in the fourth quarter of last year, but short of the $1.01 analysts had been expecting. Wedbush Morgan Securities analysts Michael Pachter said the negative reaction to the fourth-quarter guidance was overblown. "We thought that the company's results were outstanding, with same-store sales of 46.3 percent and overall sales growth of 59.3 percent, meaning that GameStop gained market share during the quarter," Mr. Pachter wrote. GameStop vice chairman and chief operating officer Dan DeMatteo said during a conference call that Nintendo's Wii console will probably remain difficult to find this holiday season. "We will have it in our stores the day after Thanksgiving ... but you better get there early," Mr. DeMatteo said. "We're getting resupplied in December a couple of times, and then we're also expecting a resupply in January. But the Wii will be short throughout the quarter." To see more of The Dallas Morning News, or to subscribe to the newspaper, go to http://www.dallasnews.com. Copyright (c) 2007, The Dallas Morning News Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |