Today GameStop published its earnings for the three months ended October 28th, and they're a bit better than they were a year ago thanks to what the company claims is strong demand for (new) games, the Nintendo Switch, and collectibles.
In terms of numbers, GameStop reports (GAAP) $59.4 million in profits earned on $1.98 billion in revenues, which is a bit better than the $50.8 million on $1.95 billion in revenues it reported during the same quarter last year.
GameStop says game hardware sales rose 8.8 percent year-over-year, thanks largely to continued demand for the Nintendo Switch.
The company also saw sales of new games rise 5.4 percent year-over-year thanks to a "strong title lineup" (this is the quarter that, among other things, just barely caught the triple-threat October 27th release of Super Mario Odyssey, Wolfenstein II and Assassin's Creed Origins). However, the company saw sales of pre-owned games actually drop 2.8 percent year-over-year.
Outside of games, GameStop reports earnings from its collectibles business rose 26.5 percent year-over-year, though even with that growth collectibles sales only account for roughly 6 percent of total revenues, whereas sales of new games accounts for 32 percent. Revenues from the company's technology business (which encompasses things like smartphone sales via its Spring Mobile stores) actually fell by 10.2 percent year-over-year.
“Our third quarter sales results were driven by strong software demand and continued momentum for Nintendo Switch and collectibles,” stated interim GameStop CEO Dan DeMatteo, who's currently stepping in so that CEO J. Paul Raines can focus on dealing with a medical issue.
“As we enter the fourth quarter, we are encouraged by the initial customer response to Microsoft’s Xbox One X, and believe that the holiday season results will be driven by new console hardware and collectibles. Our Technology Brands AT&T Wireless business underperformed our expectations for the third quarter and we anticipate that the fourth quarter results will be highly dependent on the availability of Apple’s next-generation iPhone X.”