GameStop announced the quarterly results for the company today. In a shocking turn of events, the company destroyed its previous quarterly record with massive sales of AAA titles like GTA IV, Mario Kart, and Smash Bros. Brawl. Sales rose 42% over the previous quarter to a stunning $1.8 billion while profits rose 151% to $62.1 million. Excuse me while I take my sarcastic hat off. GameStop makes a lot of money from video games, and when three big titles like those are all released in one quarter, it’s going to be a great quarter for GameStop’s abacus pushers. What is notable, however, is that GameStop’s great quarter was so dependent on new games and not used games. To wit:
GameStop reported that new game software sales were up an “amazing” 72 percent, with comparable store sales up 27.1 percent in the first quarter. New game hardware made up 18.7 percent of sales at $339 million, new game software making up 43.7 percent at $792.8 million, and used games making up 22.9 percent at $415.7 million.
Hit the jump for some “bullish” statements from CEO R. Richard Fontaine.
The future certainly appears rosy for GameStop:
Said Fontaine, “We are very bullish on the future as three major metrics are transforming the business and accelerating the potential for GameStop growth. The installed base of video game consoles grew 34% in 2007, or nearly 31 million units, the highest incremental growth in the history of the business, and we are forecasting that hardware unit sell-thru will match these levels in 2008.”
“Behind the huge hardware growth is the fact that the demographic for video gaming is expanding dramatically as industry figures indicate that 38% of game players are female. Finally, we have an outstanding line-up of new games coming during the rest of the year, including Nintendo’s Wii Fit, Konami’s Metal Gear Solid 4, Microsoft’s Gears of War 2, and Activision’s Guitar Hero 4,” he concluded.
The bottom line is that we’re in a boom for the video game industry, so it’s a boom for GameStop too.
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