GameStop Reports 2011 Holiday Sales Results

Post by **Apoptosis** » Mon Jan 16, 2012 9:48 am

GRAPEVINE, Texas--(BUSINESS WIRE)--Jan. 9, 2012-- GameStop Corp. (NYSE: GME), the world’s largest multichannel video game retailer, today reported sales results for the nine-week holiday period ended Dec. 31, 2011.

Total sales for the period were $3.02 billion, a slight increase compared to the 2010 holiday sales period. Total company comparable store sales decreased 0.3%, composed of an increase of 0.3% in the U.S. offset by a decrease of 1.5% internationally. Digital sales, which are included in the Other category, grew 60%, led by Call of Duty ELITE subscriptions for downloadable content.

For the holiday period, total company sales of new video game software increased 9.9%, driven by strong sell-through of PlayStation 3 and Xbox 360 titles, such as Activision’s Call of Duty: Modern Warfare 3, Bethesda’s Elder Scrolls V: Skyrim and Ubisoft’s Assassin’s Creed: Revelations. New hardware sales declined 19.6% as there were no new console products or low enough price points to stimulate consumer demand as in 2010.

The pre-owned category increased 3.5% over last year’s holiday period and 7.0% year-to-date, indicating that customers continue to respond positively to GameStop’s value proposition.

The tablet and pre-owned mobile initiatives continue to resonate with consumers both online and in-store. During the holiday sales period, trades of mobile devices were 4% of total company trade volume. An assortment of these products is now available for sale in 460 U.S. stores and tablets are available in 200 U.S. stores and at www.GameStop.com.

Paul Raines, chief executive officer, commented, "During the holiday, our solid sales performance of new high-def console software was offset by weak Wii software sales and hardware sales due to the lack of new hardware offerings versus the 2010 period. We were pleased with the performance of our buy-sell-trade business, digital offerings and mobile initiatives. GameStop also retired the remainder of its long-term debt establishing a debt-free balance sheet as we go into 2012."

Share Repurchase Update

During the holiday period, GameStop repurchased two million shares at an average price of $22.38, or $45.2 million worth of stock. On Dec. 16, 2011, the company also retired the remaining $125 million of its senior notes. As of today, the company has approximately $329.8 million remaining of its current share repurchase authorization.

Guidance Update

Based on the holiday sales results, GameStop now expects comparable store sales for both the fourth quarter and the full year to range from -2.0% to -1.0%. GameStop is reiterating its previously announced fourth quarter and full year earnings per share guidance ranges of $1.66 to $1.76 and $2.82 to $2.92, respectively, excluding debt retirement costs.

Full year 2011 sales and earnings results and fiscal 2012 earnings guidance are expected to be released in March 2012.

Note: GameStop will be presenting at the CES mini conference hosted by Credit Suisse and Oppenheimer & Co. on Tuesday, Jan. 10, 2012 at 9:00 a.m. PT in Las Vegas, NV. This presentation will be available via dial-in at 1-888-289-7292 or by visiting http://investor.GameStop.com.

About GameStop

GameStop Corp. (NYSE: GME), a Fortune 500 and S&P 500 company headquartered in Grapevine, Texas, is the world's largest multichannel video game retailer. GameStop's retail network and family of brands include 6,627 company-operated stores in 17 countries worldwide and online at www.GameStop.com. The network also includes: www.Kongregate.com, a leading browser-based game site; Game Informer(R) magazine, the leading multi-platform video game publication; Spawn Labs, a streaming technology company; and a digital PC game distribution platform available at http://www.GameStop.com/PC.