GRAPEVINE, Texas – Shares of GameStop slumped 14 percent after the video game retailer's third-quarter revenue and profit numbers were curbed by lower-than-expected sales of new software and hardware, and also some delayed store openings.
CEO Paul Raines expects fourth-quarter results to improve due to a solid slate of new video games and the company stuck by its guidance for the full year, but that didn't appear to reassure investors, who sent shares down to levels not seen since January.
"We anticipated they would raise performance numbers provided the strong content release slate and recent hardware price cuts," wrote Mike Hickey of Benchmark Research.
Though Raines expects improvement in the current quarter, the company's projections for per-share profits between $2.12 and $2.32 fall well below the $2.37 Wall Street was looking for.
GameStop reported net income of $55.9 million, or 53 cents a share, compared with $56.4 million, or 50 cents a share, last year. Excluding one-time items, earnings were 54 cents per share.
Analysts had projected earnings of 59 cents per share, according to a poll by Zacks Investment Research.
There are fewer shares outstanding this year.
Revenue was $2.02 billion, which was just shy of projections by analysts.
Shares fell $5.42 to $33.84 in early trading.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on GME at http://www.zacks.com/ap/GME
Keywords: GameStop, Earnings Report