Gamasutra is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.


Gamasutra: The Art & Business of Making Gamesspacer
View All     RSS
July 5, 2022
arrowPress Releases
If you enjoy reading this site, you might also want to check out these UBM Tech sites:


Pachter: GameStop To Take Majority Of Hit Software Sales

Pachter: GameStop To Take Majority Of Hit Software Sales

May 23, 2007 | By Brandon Boyer




In his latest note to investors on GameStop's newly reported record Q1 earnings, Wedbush's Michael Pachter has said he expects the retailer to capture a "disproportionate share of sales" for 2007's headline titles like Halo 3 and GTA IV, but continue to lose marketshare on new hardware.

Speaking on today's results, Pachter said, "We expected the company to report results at or slightly above the high end of its guidance, so the earnings upside was not a big surprise," adding that the true story was not its quarterly earnings, but its guidance going forward.

"As we have said for several quarters, we continue to believe that GameStop is a 2007 - 2008 story," said Pachter. "Given relatively light launches for the Nintendo Wii and the Sony PS3, we believe that there is significant upside to company guidance for FY:07, particularly as we expect U.S. sales of 4.5 million PS3s and 7 million Wiis during the year."

He added that the same was true of its software business, "conservatively" modeling "new software sales growth for GameStop of 20%, slightly above our industry growth forecast of 18%."

"We believe that GameStop will capture a disproportionate share of sales for big titles expected later in the year, such as Madden NFL 08, Guitar Hero III, Halo 3, and Grand Theft Auto IV," said Pachter, though he added, "We do not expect the company to capture a disproportionate share of hardware sales for the balance of the year, as specialty retailers tend to lose market share on year-old hardware when supply and demand are in balance."

Finally, looking at the company's overseas market, where Blockbuster has sold its Gamestation chain to Game Group PLC, marking an end to a move Pachter has long held that GameStop should have made, he commented that the Game Group purchase was a "lost opportunity."

"In our view," said Pachter, "the UK has room for over 1000 GameStop stores, and given that there are currently fewer than 30, we believe that the territory presents the most compelling opportunity for growth. The sale to Game Group creates a greater barrier to entry into the UK market, and we think that it sets GameStop's growth plans back by at least two years in that territory."


Related Jobs

Build a Rocket Boy Games
Build a Rocket Boy Games — Edinburgh, Scotland, United Kingdom
[07.04.22]

Lead Physics Programmer
Build a Rocket Boy Games
Build a Rocket Boy Games — Edinburgh, Scotland, United Kingdom
[07.04.22]

Lead UI Programmer
Build a Rocket Boy Games
Build a Rocket Boy Games — Edinburgh, Scotland, United Kingdom
[07.04.22]

Lead Graphics Programmer
Build a Rocket Boy Games
Build a Rocket Boy Games — Edinburgh, Scotland, United Kingdom
[07.04.22]

Lead Animation Programmer









Loading Comments

loader image