Welcome!

Agile Computing Authors: Liz McMillan, Corey Roth, Pat Romanski, Elizabeth White, Yeshim Deniz

News Feed Item

GameStop Reports Second Quarter 2014 Results

GameStop Corp. (NYSE: GME), a family of specialty retail brands that makes the most popular technologies affordable and simple, today reported sales and earnings for the second quarter ended August 2, 2014.

Second Quarter Results

Total global sales for the second quarter of 2014 were $1.73 billion, a 25.1% increase compared to $1.38 billion in the prior year quarter. Consolidated comparable store sales increased 21.9%.

During the quarter, new hardware sales increased 124.8%, as worldwide demand for Microsoft’s Xbox One and Sony’s PlayStation 4 remains very high. New software sales grew 15.6% driven by the strong performance of recently released new titles, such as Ubisoft’s Watch Dogs and Nintendo’s Mario Kart 8. Each of these categories outperformed the overall market, leading to 200 basis points of total market share gain. The pre-owned/value category saw positive growth, +5.5%, for the second consecutive quarter.

Sales in the mobile & consumer electronics category rose 85.1%, led by the ongoing expansion and strong results of Spring Mobile and Simply Mac. The Technology Brands segment contributed 19% of the company’s second quarter’s operating profit.

Non-GAAP digital receipts increased 17.6% to $179.2 million, or $52.3 million of sales on a GAAP basis, led by strong platform currency, mobile and global Steam Wallet sales.

Global multichannel sales (mobile, web-in-store, pick-up at store, ecommerce) advanced 49.3% as customers utilized all of the channels GameStop offers to purchase video gaming and mobile electronic products.

GameStop’s net earnings for the second quarter were $24.6 million, a 134.3% increase compared to net earnings of $10.5 million in the prior year quarter. Diluted earnings per share were $0.22, a 144.4% increase compared to diluted earnings per share of $0.09 in the prior year quarter.

“The second quarter demonstrates the power of the new console cycle and all of our business units, including Technology Brands, positively contributing to the company’s sales and profits,” stated Rob Lloyd, chief financial officer. “The back half of the year is filled with exciting games and products coming to market and I am confident that we are prepared to capitalize on these opportunities.”

Capital Allocation Update

During the second quarter of 2014, the company repurchased 1.90 million shares at an average price of $39.67, or $75.5 million of stock. There is now $329.4 million remaining on the existing repurchase authorization.

GameStop’s board of directors also declared a quarterly cash dividend of $0.33 per common share payable on September 16, 2014, to shareholders of record as of the close of business on September 3, 2014.

Earnings Guidance

For the third quarter of fiscal 2014, GameStop expects comparable store sales to range from +1.0% to +5.0%.

Diluted earnings per share are expected to range from $0.58 to $0.64, representing flat to +10.3% growth over the prior year quarter.

For fiscal year 2014, the company is maintaining its previously announced full year diluted earnings per share guidance range of $3.40 to $3.70. Full year comparable store sales are expected to range from +6.0% to +12.0%.

Note: Current guidance only includes the effect of the shares repurchased thus far in fiscal 2014.

Conference Call Information

A conference call with GameStop Corp.’s management is scheduled for August 21, 2014 at 4:00 p.m. CDT to discuss the company’s financial results. The phone number for the call is 1-888-208-1507 and the pass code is 8853550. This call can also be accessed at GameStop Corp.’s investor relations home page at http://investor.GameStop.com/. The conference call will be archived for two months on GameStop’s corporate website.

About GameStop

GameStop Corp. (NYSE: GME), a Fortune 500 and S&P 500 company headquartered in Grapevine, Texas, is a global, multichannel video game, consumer electronics and wireless services retailer. GameStop operates more than 6,600 stores across 15 countries. The company’s consumer product network also includes www.gamestop.com; www.Kongregate.com, a leading browser-based game site; Game Informer® magazine, the world’s leading print and digital video game publication; and www.buymytronics.com, an online consumer electronics trade-in platform. In addition, our Technology Brands segment includes our Simply Mac, Spring Mobile and Cricket stores. Simply Mac, www.simplymac.com, operates 33 stores, selling the full line of Apple products, including laptops, tablets, smartphones and offering Apple certified warranty and repair services. Spring Mobile, http://springmobile.com, sells post-paid AT&T services and wireless products through its 238 AT&T branded stores. Cricket Wireless, www.cricketwireless.com, is a new AT&T brand offering pre-paid wireless services, devices and related accessories. We operate 48 Cricket stores in select markets throughout the United States.

General information about GameStop Corp. can be obtained at the company's corporate website. Follow GameStop on Twitter @ www.twitter.com/GameStop and find GameStop on Facebook @ www.facebook.com/GameStop.

Non-GAAP Measures

As a supplement to our financial results presented in accordance with U.S. generally accepted accounting principles (GAAP), GameStop uses certain non-GAAP measures, such as digital receipts, to provide a clearer perspective of the current operating performance of the company. GameStop defines digital receipts as the full amount paid by the customer for digital content at the time of sale and/or the value attributed to digital content when physical and digital products are sold combined. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the company's reported GAAP financial results.

Safe Harbor

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, the outlook for the third quarter and fiscal 2014, future financial and operating results, projected store openings, the company's plans, objectives, expectations and intentions, and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of GameStop's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. GameStop undertakes no obligation to publicly update or revise any forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the inability to obtain sufficient quantities of product to meet consumer demand, including console hardware and accessories; the timing of release of video game titles for current generation consoles; the risks associated with international operations, wireless industry operations and the integration of acquisitions; the impact of increased competition and changing technology in the video game industry, including browser and mobile games and alternative methods of distribution; and economic, regulatory and other events, including litigation, that could reduce or impact consumer demand or affect the company’s business. Additional factors that could cause GameStop's results to differ materially from those described in the forward-looking statements can be found in GameStop's Annual Report on Form 10-K for the fiscal year ended Feb. 1, 2014 filed with the SEC and available at the SEC's Internet site at http://www.sec.gov or http://investor.GameStop.com.

 
 
GameStop Corp.
Condensed Consolidated Statements of Operations
(in millions, except per share data)
(unaudited)
       
13 weeks 13 weeks
ended ended
Aug 2, 2014 Aug 3, 2013
 
Net sales $ 1,731.4 $ 1,383.7
Cost of sales   1,180.5     902.3  
 
Gross profit 550.9 481.4
 
Selling, general and administrative
expenses 475.4 421.6
Depreciation and amortization   38.8     41.0  
 
Operating earnings 36.7 18.8
 
Interest expense, net   1.1     1.3  
 
 
Earnings before income tax expense 35.6 17.5
 
Income tax expense   11.0     7.0  
 
Net income $ 24.6   $ 10.5  
 
Net income per common share:
Basic $ 0.22 $ 0.09
Diluted $ 0.22 $ 0.09
 
Dividends per common share $ 0.33 $ 0.275
 
Weighted average common shares
outstanding:
Basic 113.6 117.9
Diluted 114.3 119.2
 
 
 

Percentage of Net Sales:

 
Net sales 100.0 % 100.0 %
Cost of sales   68.2 %   65.2 %
 
Gross profit 31.8 % 34.8 %
 
Selling, general and administrative
expenses 27.5 % 30.5 %
Depreciation and amortization   2.2 %   2.9 %
 
Operating earnings 2.1 % 1.4 %
 
Interest expense, net   0.1 %   0.1 %
 
 
Earnings before income tax expense 2.0 % 1.3 %
 
Income tax expense   0.6 %   0.5 %
 
Net income   1.4 %   0.8 %

 
 
GameStop Corp.
Condensed Consolidated Statements of Operations
(in millions, except per share data)
(unaudited)
       
26 weeks 26 weeks
ended ended
Aug 2, 2014 Aug 3, 2013
 
Net sales $ 3,727.7 $ 3,249.0
Cost of sales   2,550.4     2,189.3  
 
Gross profit 1,177.3 1,059.7
 
Selling, general and administrative
expenses 956.4 870.8
Depreciation and amortization   78.3     82.9  
 
Operating earnings 142.6 106.0
 
Interest expense, net   1.7     2.2  
 
 
Earnings before income tax expense 140.9 103.8
 
Income tax expense   48.3     38.7  
 
Net income $ 92.6   $ 65.1  
 
Net income per common share:
Basic $ 0.81 $ 0.55
Diluted $ 0.80 $ 0.55
 
Dividends per common share $ 0.66 $ 0.55
 
Weighted average common shares
outstanding:
Basic 114.3 118.1
Diluted 115.1 119.3
 
 
 

Percentage of Net Sales:

 
Net sales 100.0 % 100.0 %
Cost of sales   68.4 %   67.4 %
 
Gross profit 31.6 % 32.6 %
 
Selling, general and administrative
expenses 25.7 % 26.8 %
Depreciation and amortization   2.1 %   2.5 %
 
Operating earnings 3.8 % 3.3 %
 
Interest expense, net   0.0 %   0.1 %
 
 
Earnings before income tax expense 3.8 % 3.2 %
 
Income tax expense   1.3 %   1.2 %
 
Net income   2.5 %   2.0 %

 
 
GameStop Corp.
Condensed Consolidated Balance Sheets
(in millions)
(unaudited)
       
Aug 2, Aug 3,
2014 2013
ASSETS:
Current assets:
Cash and cash equivalents $ 193.0 $ 127.4
Receivables, net 91.2 55.7
Merchandise inventories, net 1,061.0 1,004.4
Prepaid expenses and other current assets 181.9 149.7
Deferred income taxes   59.2   55.2
Total current assets   1,586.3   1,392.4
 
Property and equipment:
Land 21.0 20.7
Buildings & leasehold improvements 621.9 594.3
Fixtures and equipment   864.0   939.2
Total property and equipment 1,506.9 1,554.2
 
Less accumulated depreciation and amortization   1,057.2   1,074.8
Net property and equipment   449.7   479.4
 
Goodwill 1,420.6 1,365.1
Other noncurrent assets   306.9   201.4
Total assets $ 3,763.5 $ 3,438.3
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $ 460.8 $ 315.8
Accrued liabilities 743.1 812.0
Income taxes payable 29.7 -
Current portion of debt   214.1   50.0
Total current liabilities 1,447.7 1,177.8
 
 
Other long-term liabilities   134.4   103.8
Total liabilities 1,582.1 1,281.6
 
Stockholders' equity   2,181.4   2,156.7
Total liabilities and stockholders' equity $ 3,763.5 $ 3,438.3

 
 
GameStop Corp.
 
Schedule I
Sales Mix
(unaudited)
               
13 Weeks Ended 13 Weeks Ended
Aug 2, 2014 Aug 3, 2013
Net Percent Net Percent
Sales of Total Sales of Total
Net Sales (in millions):
 
New video game hardware $ 332.3 19.2 % $ 147.8 10.7 %
New video game software 497.0 28.7 % 429.8 31.1 %
Pre-owned and value video game products 558.0 32.2 % 528.7 38.2 %
Video game accessories 107.5 6.2 % 92.0 6.6 %
Digital 52.3 3.0 % 49.4 3.6 %
Mobile and consumer electronics 112.1 6.5 % 60.6 4.4 %
Other 72.2 4.2 % 75.4 5.4 %
       
Total $ 1,731.4 100.0 % $ 1,383.7 100.0 %
 
 
 
Schedule II
Gross Profit Mix
(unaudited)
 
13 Weeks Ended 13 Weeks Ended
Aug 2, 2014 Aug 3, 2013
Gross Gross
Gross Profit Gross Profit
Profit Percent Profit Percent
 
Gross Profit (in millions):
 
New video game hardware $ 31.6 9.5 % $ 15.5 10.5 %
New video game software 115.7 23.3 % 98.9 23.0 %
Pre-owned and value video game products 262.1 47.0 % 250.6 47.4 %
Video game accessories 41.9 39.0 % 38.4 41.7 %
Digital 34.0 65.0 % 35.1 71.1 %
Mobile and consumer electronics 40.5 36.1 % 16.3 26.9 %
Other 25.1 34.8 % 26.6 35.3 %
   
Total $ 550.9 31.8 % $ 481.4 34.8 %

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
IoT is rapidly becoming mainstream as more and more investments are made into the platforms and technology. As this movement continues to expand and gain momentum it creates a massive wall of noise that can be difficult to sift through. Unfortunately, this inevitably makes IoT less approachable for people to get started with and can hamper efforts to integrate this key technology into your own portfolio. There are so many connected products already in place today with many hundreds more on the h...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...
Detecting internal user threats in the Big Data eco-system is challenging and cumbersome. Many organizations monitor internal usage of the Big Data eco-system using a set of alerts. This is not a scalable process given the increase in the number of alerts with the accelerating growth in data volume and user base. Organizations are increasingly leveraging machine learning to monitor only those data elements that are sensitive and critical, autonomously establish monitoring policies, and to detect...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settl...
In his session at @ThingsExpo, Dr. Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, presented the findings of a series of six detailed case studies of how large corporations are implementing IoT. The session explored how IoT has improved their economic performance, had major impacts on business models and resulted in impressive ROIs. The companies covered span manufacturing and services firms. He also explored servicification, how manufacturing firms shift from se...
DevOpsSummit New York 2018, colocated with CloudEXPO | DXWorldEXPO New York 2018 will be held November 11-13, 2018, in New York City. Digital Transformation (DX) is a major focus with the introduction of DXWorldEXPO within the program. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of bus...
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, compared the Jevons Paradox to modern-day enterprise IT, examin...
IoT solutions exploit operational data generated by Internet-connected smart “things” for the purpose of gaining operational insight and producing “better outcomes” (for example, create new business models, eliminate unscheduled maintenance, etc.). The explosive proliferation of IoT solutions will result in an exponential growth in the volume of IoT data, precipitating significant Information Governance issues: who owns the IoT data, what are the rights/duties of IoT solutions adopters towards t...
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smart...