As the economy continues to prove itself less and less predictable, GameStop continues to post record sales which is the case for their first quarter earnings report. Used game sales are up and new games sales are slightly down. Revenue increased from $1.81 billion this time last year to $1.98 billion, due to the strong showing by the DSi as well as Resident Evil 5 and Street Fighter IV.
“During the quarter GameStop sustained its strong earnings growth momentum and exceeded earnings guidance despite less than planned comparable store sales,” indicated Daniel DeMatteo, CEO of GameStop. “Although new video game software sales declined by 2.8%, lower-priced used products grew a robust 31.9%, illustrating that value is becoming more important to our customers.” With such a huge increase in used game sales came a huge increase in net profit from $62.1 million the prior year, to $70.4 million this quarter. Even in the face of the economy, DeMatteo goes on to mention that GameStop was still able to open several new stores, expanding their hold on the used games market.
DeMatteo feels they haven’t peaked yet as the strong line-up for the rest of the year in the wake of the global economy only means increased sales. “In the second quarter, like the first, we face very strong comparisons to the prior year period due to the unprecedented number of blockbuster titles released in the first half of 2008 and a significantly more brittle global economy. We do expect the back half of this year to be stronger than the first half due to a full and wide-ranging new title lineup. All together, this places us in a prime position to capitalize on the growth in the market in the fall and holiday seasons.”