GameStop, the entertainment software retail chain headquartered in Texas, saw its shares get clobbered Thursday despite reporting a 151 percent jump in net profits to $62.1 million on a 42 percent gain in sales to $1.8 billion in its first quarter, compared with $24.7 million in net profit in the year-before quarter on $1.3 billion in sales.
It’s shares ended the day down $1.87, or 3.7 percent, to $48.97, marking their fifth daily
drop in a row in very heavy trading (some 17 million shares traded hands Thursday , a more than four-fold increase from the day before).
Wall Street was evidently disappointed that the company indicated sales growth will slow the rest of year. It forecast year-over-year growth of between 12 to 14 percent in its current quarter, and 10 to 12 percent for the full year, down from the 27 percent gain in its most recent quarter. (Comparisons in the company’s third quarter will be measured against the year-before quarter during which the record-setting Halo 3 game from Microsoft was released last September.)
Take-Two Interactive’s Grand Theft Auto IV was reported to be GameStop’s top-selling game during the quarter just ended on May 3, with only five days of sales following its late-April release.