GameStop Reports $8.8b in Sales in ’08

GameStop Reports $8.8b in Sales in '08

In the face of a recession, Irvine, Tex.-based GameStop expects to continue growth in 2009, and has also updated its fiscal Q4 projections.

For fiscal Q4 ended in January this year, GameStop narrowed its earnings per share guidance to the high-end of previous projections. The firm now expects EPS in the range of $1.33 to $1.34, or a 17-18 percent year-on-year increase.

For the first time in GameStop history, quarterly revenues surpassed $3 billion, with total sales coming in at $3.5 billion, a 22 percent year-on-year increase. Comparable store sales were up 9.6 percent.

GameStop expects full-year fiscal 2008 earnings per share to be between $2.39 to $2.40, or a 33 percent rise. Full year sales jumped 24 percent to $8.8 billion, up from $7.1 billion in 2007. Comparable store sales increased 12.3 percent for the full year.

For fiscal 2009, GameStop projected total sales growth between 10 and 12 percent; comparable store sales growth between 4 and 6 percent; earnings per share increases of 18 to 22 percent; and the establishment of 400 new stores worldwide.

Those growth expectations take into consideration management’s belief that the recession will continue through holiday 2009.

Final sales and earnings results for the year will release in mid-March, GameStop said.

“The videogame business continues to enjoy robust growth, making it the fastest growing of the many consumer goods categories,” said GameStop CEO Dan DeMatteo in a statement.

“2008 marked yet another year of strong new hardware sales, which will again help drive sales of new videogames in the years ahead. This trend continued in January as NPD reported US new hardware unit sales grew 29 percent, led by Nintendo’s Wii, DS and Microsoft’s Xbox 360."

Additionally, GameStop will continue to expand in overseas markets, namely Europe. The company expects sales to hit $2 billion in the region this year.

sssss