GameStop Tanks on Miss, Outlook
NEW YORK (
) --
GameStop
(GME) - Get Report
reported second-quarter earnings that fell short of estimates, and issued a disappointing forecast for the second-half of the year, sending shares tumbling in morning trading.
During the quarter, the video game retailer earned $40.3 million, or 26 cents a share, a 4% increase from $38.7 million, or 26 cents, last year. Still this was as penny shy of Wall Street's outlook for GameStop.
GameStop revenue increased 3% to $1.8 billion, in-line with expectations.
The company said it was hurt by soft demand for used video games, which inched up just 0.8%. Sales of new games grew 5.3%, and hardware increased 4.3% during the quarter.
Looking ahead, GameStop is looking for third-quarter profit in the range of 35 cents to 38 cents a share, and full-year earnings between $2.58 and $2.68 a share. Analysts are predicting a profit of 39 cents and full-year earnings of $2.63 a share.
GameStop's stock is plunging 7.5% to $19.20 in morning trading.
Overall, the video game sector has been weak, with sales of software down 12% for the quarter, according to the NPD Group.
-- Reported by Jeanine Poggi in New York.
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