GameStop Corp. (NYSE: GME) stock plummeted in the after-market session after the announcement of its Earnings Results for the Q3 ended 31 October 2020. Indicating steady momentum in its long-term organizational plans and a promising start to the Q4 following the introduction of the long-awaited next-generation video game consoles.
Net revenues amounted to $1,004.7 million, down 30.2 percent from the third quarter of the fiscal year 2019, reflecting the effect of activities during the last few months of the seven-year new generation console cycle and the resulting restricted supply of hardware and accessories.
The 11 percent decline in the store base, as part of the company’s de-densification policy, was partly compensated by recaptured revenue by the transition to nearby markets and online sales. Comparable retail sales dropped by 24.6 percent.
Comparable store sales, which include e-commerce revenue, increased by 57%.
Looking ahead, the Group continues to reflect on the efforts it has made to navigate during this extraordinary period, including retaining its balance sheet strength, prioritizing the distribution of capital to areas of business that deliver good cash flow through reducing spending around the company, improving and extending its digital strategy, and strengthening inventory discipline.
Owing to the uncertainties surrounding the period and the changing effect of COVID-19, the Organization continues to suspend guidance. Still, it plans to report positive comparable revenue and profitability in the Q4 of the fiscal year.
For fiscal November 2020, comparable-store revenues grew by 16.5 percent, and overall net sales increased by $791.1 million compared to $747.6 million in fiscal November 2019.