Shares Of GameStop Collapsed After This News Came Out

GameStop shares fell more than 13% on Friday after the company released its fourth quarter results on Thursday.

The company saw declines in almost all of its segments, reporting a 29.1% decline in hardware sales and a 19.3% decline in software sales. These two segments had previously been revenue boosters for the video game company.

Sales decreased 13.6 percent to $3.05 billion in the fiscal fourth quarter while comparable sales declined 16.3%. According to FactSet, these fell in line with analysts estimates.

Adjusted quarterly earnings came in at $2.38 per share, which was ahead of the Thomson Reuters estimate of $2.28, but came in 2 cents lower than the same period one year ago.

Looking ahead, the company expects to close between 2 to 3 percent of its global store footprint in 2017. According to the company, the video game category has become “weak.”

The company wrote in its earnings release, “The fourth quarter [ended Jan. 28] was significantly impacted by … aggressive console promotions by other retailers on Thanksgiving [Day] and Black Friday.”

Chief Financial Officer Rob Llyod said in a statement that moving forward, GameStop will no longer provide quarterly earnings nor same-store-sales guidance.

Lloyd said, “We believe that providing only annual guidance will reduce investor distraction as we continue to diversify the company and seek to maximize long-term shareholder value.”

Shares of the stock have fallen more than 30% over the last 12 mnths and are down more than 18% year-to-date.

Disclaimer: We have no position in GameStop Corp. (NYSE: GME) and have not been compensated for this article.

Sofia Vida

Sofia has been writing for major news outlets for over 15 years. In her spare time she enjoys hiking, walking her dogs, and going to concerts.

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