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GameStop holiday sales slip 4.6%

Specialty retailer says Wii U launch was successful, but couldn't offset decline in store traffic, 15.6% drop in used sales

For the first time since it merged with chief rival Electronics Boutique in 2005, GameStop has seen its year-over-year holiday sales total decrease. Today the company announced sales for the last nine weeks of 2012, revealing a $2.88 billion mark that stands as a 4.6 percent decrease from 2011's holiday haul.

GameStop blamed a lack of in-store traffic as the primary culprit. Second-hand sales were down 15.6 percent, with the retailer citing limited inventory due to fewer games released in 2012. New game sales were down 5.1 percent, while hardware numbers were down 2.7 percent.

As for what went right, GameStop cited a successful Wii U launch (with 320,000 systems sold worldwide) and continued growth in its online and mobile businesses. Digital sales were up more than 40 percent for the holiday period, e-commerce sales rose 20.5 percent, and mobile brought in $76.5 million. The retailer didn't say how much of an increase that constituted, but its mobile buyback program for iOS devices had barely begun at the outset of the 2011 holiday season.

GameStop cautioned investors that it expects to come in at the low end of its earnings per share guidance range of $2.07 to $2.27. Additionally, it narrowed its expected range for comparable store sales. Previously set between -7 percent and +1 percent, GameStop now expects comparable store sales to do no better than -4 percent for its fiscal fourth quarter.

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Latest comments (5)

Bruce Everiss Marketing Consultant 3 years ago
Very well run company, compare and contrast with what happened to Game in the UK.
But even excellent management cannot defy gravity forever. As we now see.
Their strategy of moving away from bricks and mortar to online is following their customers.
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Sebastian Moss Editor -in- Chief, PlayStation LifeStyle3 years ago
With GTA V and the probable launches of next gen consoles this year, 2013 will certainly still be a big year for retail, but yeah, more and more people are moving to online retail, digital download, and possibly, eventually cloud.
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Christopher Bowen Editor in Chief, Gaming Bus3 years ago
What's that? i'm sorry, I couldn't hear anything over the games I'm playing that I got from the Steam sale.
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Christopher Bowen Editor in Chief, Gaming Bus3 years ago
@Sebastian - You inadvertently detailed the problem with your post. You listed one game, and the "probable" launch of new consoles from one company who's making money hand over fist on their current console, and another that doesn't have the money to launch a mousetrap at this point, much less a console (which, I'll add, historically lose money starting out). This is such a hits-driven business, and a lot of those hits are going digital. No one's going to go to a brick-and-mortar store to buy a digital game, unless they walk in with tin foil on their heads.

GameStop is going to have to adjust, and I don't know that they can do that more than they already have. They're being attacked on all sides.
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Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.3 years ago
"GameStop cited a successful Wii U launch"

"Wii U launch disappoints, says analyst"

I'm just going to leave that right here.
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