GameStop Corp. shares were troubled during Tuesday’s extended session as the video game store at the center of the so-called meme-stock phenomenon said it had laid the groundwork for its ‘transformation’ and lower-than-expected adjusted earnings for the fourth quarter reported. and sales.
GameStop GME,
stocks initially rose more than 8% after the report, but profits later fell and fell 3% for the last time. The retailer said it made $ 80.5 million or $ 1.19 a share in the quarter, compared to earnings of 32 cents a share in the quarter from a year ago.
Adjusted for one-time items, GameStop earned $ 90.7 million, or $ 1.34 per share, compared to $ 1.27 per share a year ago.
Revenues fell to $ 2.12 billion, compared to $ 2.19 billion in the fourth quarter of fiscal 2019, due to store closings related to the pandemic, the company said.
Analysts polled by FactSet expected the video game retailer to report adjusted earnings of $ 1.35 per share on revenue of $ 2.21 billion.
GameStop said same-store sales were up 6.5% in the quarter, with online sales up 175% for the quarter and 191% for fiscal 2020. The analysts polled by FactSet expected same-store sales to increase 4.7% in the quarter.
The company said it “strengthened” its balance sheet and closed the year with $ 635 million in cash, “laying the foundation for transformation.”
In a separate press release, GameStop said it had appointed Jenna Owens as Chief Operating Officer, with a start date of Monday, March 29. Owens was a director and distribution manager of Amazon.com Inc. AMZN,
The company also named Neda Pacifico, who was an executive at Chewy Inc. CHWY,
as senior vice president of e-commerce. Pacifico also starts on Mondays.
Chewy co-founder Ryan Cohen and two of his allies joined the GameStop board earlier this year, sparking hopes he would lead an overhaul.
GameStop’s stock is often cited as one of the meme shares that have skyrocketed in recent months thanks to insane boosts from Reddit comments and social media posts.
Also see: GameStop: What’s The Fun In The Basics, Ask Reddit Traders On The Rocket Emoji Launch Pad
GameStop’s stock is up more than 800% in the past three months, compared to a gain of about 7% for the S&P 500 index SPX,