GameStop Corp. (GME - Free Report) posted second-quarter fiscal 2023 results, delivering a narrower-than-expected loss per share and better-than-expected revenues. The top and bottom lines increased from their respective year-ago quarter’s reported figures.
Shares of this Zacks Rank #2 (Buy) company have decreased 12.5% in the past three months compared with the industry’s 4.5% decline.
Q2 in Details
GameStop posted an adjusted loss of 3 cents per share in second-quarter fiscal 2023, narrower than the Zacks Consensus Estimate of a loss of 15 cents. The company had incurred an adjusted loss per share of 35 cents in the prior year quarter.
GME reported net sales of $1,163.8 million, which surpassed the Zacks Consensus Estimate of $1,143 million. Also, the metric increased from $1,136 million reported in the year-ago fiscal quarter. Management highlighted that a significant software release and increased sales of new gaming hardware in international segments contributed to the top-line growth, partially offset by a decline in sales of collectibles.
By sales mix, hardware and accessories sales inched up to $597 million from $596.4 million reported in the year-ago quarter. Software sales came in at $397 million, up from $316.4 million in the prior year quarter. Sales in the collectibles unit amounted to $169.8 million compared with $223.2 million reported in the year-ago quarter.
Margins
Gross profit increased to $305.9 million from $282.2 million in the year-ago fiscal quarter. Selling, general and administrative (SG&A) expenses declined to $322.5 million from $387.5 million reported in the year-ago quarter. As a percentage of net sales, SG&A expenses came in at 27.7%, down from 34.1% reported in the year-ago period.
The company’s adjusted operating loss was $20.7 million in the reported quarter. It had reported an adjusted operating loss of $106.2 million in the prior-year fiscal period. Adjusted EBITDA was $1 million compared with an adjusted EBITDA loss of $78.1 million in the prior-year quarter.
Other Financial Aspects
GameStop ended the second quarter with cash and cash equivalents of $894.7 million, long-term debt of $23.6 million and stockholders’ equity of $1,267.2 million. Inventory was $676.9 million at the end of the reported quarter compared with $734.8 million at the close of the same quarter last year. This reflects the company’s ongoing focus on maintaining a healthy inventory position.
During the second quarter, the company used cash flow from operations of $109.1 million compared with an outflow of $103.4 million during the same period last year. Free cash flow at the end of the reported quarter came in at a negative $119.2 million. Capital expenditures in the quarter amounted to $10.1 million.
Other Key Picks
We have highlighted three other top-ranked stocks, namely Abercrombie & Fitch (ANF - Free Report) , Boot Barn (BOOT - Free Report) and American Eagle Outfitters (AEO - Free Report) .
Abercrombie & Fitch, a leading casual apparel retailer, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 10.1% and 1,512%, respectively, from the year-ago reported figures. ANF has delivered an earnings surprise of 724.8% in the last four quarters.
Boot Barn, a fashion retailer of apparel and accessories, currently flaunts a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 13.5%, on average.
The Zacks Consensus Estimate for Boot Barn’s current financial-year sales implies a rise of 5.1% from the year-ago reported figure.
American Eagle Outfitters, a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2. AEO has delivered an average earnings surprise of 9.2% in the last four quarters.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year EPS indicates a jump of 8.3% from the year-ago reported figure.
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GameStop Corp. (GME - Free Report) posted second-quarter fiscal 2023 results, delivering a narrower-than-expected loss per share and better-than-expected revenues. The top and bottom lines increased from their respective year-ago quarter’s reported figures.
Shares of this Zacks Rank #2 (Buy) company have decreased 12.5% in the past three months compared with the industry’s 4.5% decline.
Q2 in Details
GameStop posted an adjusted loss of 3 cents per share in second-quarter fiscal 2023, narrower than the Zacks Consensus Estimate of a loss of 15 cents. The company had incurred an adjusted loss per share of 35 cents in the prior year quarter.
GME reported net sales of $1,163.8 million, which surpassed the Zacks Consensus Estimate of $1,143 million. Also, the metric increased from $1,136 million reported in the year-ago fiscal quarter. Management highlighted that a significant software release and increased sales of new gaming hardware in international segments contributed to the top-line growth, partially offset by a decline in sales of collectibles.
By sales mix, hardware and accessories sales inched up to $597 million from $596.4 million reported in the year-ago quarter. Software sales came in at $397 million, up from $316.4 million in the prior year quarter. Sales in the collectibles unit amounted to $169.8 million compared with $223.2 million reported in the year-ago quarter.
Margins
Gross profit increased to $305.9 million from $282.2 million in the year-ago fiscal quarter. Selling, general and administrative (SG&A) expenses declined to $322.5 million from $387.5 million reported in the year-ago quarter. As a percentage of net sales, SG&A expenses came in at 27.7%, down from 34.1% reported in the year-ago period.
The company’s adjusted operating loss was $20.7 million in the reported quarter. It had reported an adjusted operating loss of $106.2 million in the prior-year fiscal period. Adjusted EBITDA was $1 million compared with an adjusted EBITDA loss of $78.1 million in the prior-year quarter.
Other Financial Aspects
GameStop ended the second quarter with cash and cash equivalents of $894.7 million, long-term debt of $23.6 million and stockholders’ equity of $1,267.2 million. Inventory was $676.9 million at the end of the reported quarter compared with $734.8 million at the close of the same quarter last year. This reflects the company’s ongoing focus on maintaining a healthy inventory position.
During the second quarter, the company used cash flow from operations of $109.1 million compared with an outflow of $103.4 million during the same period last year. Free cash flow at the end of the reported quarter came in at a negative $119.2 million. Capital expenditures in the quarter amounted to $10.1 million.
Other Key Picks
We have highlighted three other top-ranked stocks, namely Abercrombie & Fitch (ANF - Free Report) , Boot Barn (BOOT - Free Report) and American Eagle Outfitters (AEO - Free Report) .
Abercrombie & Fitch, a leading casual apparel retailer, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 10.1% and 1,512%, respectively, from the year-ago reported figures. ANF has delivered an earnings surprise of 724.8% in the last four quarters.
Boot Barn, a fashion retailer of apparel and accessories, currently flaunts a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 13.5%, on average.
The Zacks Consensus Estimate for Boot Barn’s current financial-year sales implies a rise of 5.1% from the year-ago reported figure.
American Eagle Outfitters, a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2. AEO has delivered an average earnings surprise of 9.2% in the last four quarters.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year EPS indicates a jump of 8.3% from the year-ago reported figure.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>
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