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GameStop shares plummet on financial results

Analysts and investors unimpressed by retailer's "sloppy" second quarter

Shares in US-based specialist retail chain GameStop have fell by over 8 per cent following the release of its second quarter fiscal figures earlier this week.

Trading in the company opened down significantly, and stayed low throughout the day to close on $19.06, 8.2 per cent down from $20.76 the previous day.

GameStop's headline numbers pointed to a rise in total sales and net earnings, by 3.4 per cent and 4.2 per cent respectively, but that wasn't enough to impress analysts or investors.

Wedbush Morgan's Michael Pachter labelled the performance "sloppy" and noted that while the results were in line with guidance, they were below consensus numbers - while "questions remain about how GameStop will participate in digital distribution."

In a note to investors, Pachter lowered guidance on the company's share price to a "more realistic" $26.

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Latest comments (1)

Igor Macukat Studying Computer Science (Games), University of Brighton10 years ago
I was expecting for this to happen. The gaming industry as a whole are against the "used market" and retailers like GameStop need to find the way to deal with the publishers on used titles if they want to stay in the loop. Publishers like EA are slowly rolling out measures to stop people buying used games and the way digital distribution is heading, it won't be long until you see GameStop shares fall as the retailer becomes more irrelevant to gamers.
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