GameStop Beats, Guides Up - TheStreet

GameStop's

(GME) - Get Report

fourth-quarter earnings fell 12% from a year ago, due to a charge related to modified accounting for its lease expense. Excluding that, earnings beat estimates, and the video-game retailer raised guidance.

GameStop earned $34.5 million, or 64 cents a share, in the quarter, compared with $39.6 million, or 67 cents a share, a year ago. Backing out the charge, earnings were 70 cents a share in the latest quarter. Sales rose 13.3% from a year ago to $708.7 million, reflecting a 0.2% rise in same-store sales and a 14% jump in video-game sales.

Analysts had been expecting pre-charge earnings of 69 cents a share. For the current first quarter, the company expects to earn 16 cents or 17 cents a share on a same-store sales increase of 5% to 7%, compared with a year ago. Analysts were expecting earnings of 15 cents a share on sales of $419.1 million.

GameStop sees full-year earnings of $1.30 to $1.40 a share on overall sales growth of 15% to 20%. Analysts were forecasting earnings of $1.38 a share on sales of $2.07 billion. "The wide range of guidance is due to its inability to control or predict the timing of the release of new platforms, as well as the initial allocations," the company noted.

Hardware shortages, particularly for

Sony's

(SNE) - Get Report

PlayStation 2

platform, were cited by

Electronic Arts

(ERTS)

Monday night in a profit warning that whacked the game-maker's shares Tuesday and led to selling in

Activision

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,

Take-Two

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and

THQ

(THQI)

.

GameStop said it opened 338 new stores in 2004 and said it plans to open 370 to 400 new stores in 2005.