GameStop Q1 Earnings Beat Estimates, Collectibles Sales Improve Y/Y

GameStop Corp. GME posted first-quarter fiscal 2025 results, wherein the top line missed the Zacks Consensus Estimate and declined year over year. On the contrary, the bottom line beat the consensus mark and improved from the year-ago period. Collectibles sales improved significantly in the quarter under review.GameStop’s Quarterly Performance: Key InsightsGME posted adjusted earnings per share of 17 cents in first-quarter fiscal 2025, beating the Zacks Consensus Estimate for adjusted earnings of 8 cents. The company incurred an adjusted loss of 12 cents in the prior-year quarter. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)GameStop reported net sales of $732.4 million, which missed the consensus estimate of $750 million. Also, the metric decreased 16.9% from $881.8 million in the year-ago quarter. The decrease in consolidated net sales was caused by lower sales across most categories.GameStop Corp. Price, Consensus and EPS Surprise  GameStop Corp. price-consensus-eps-surprise-chart | GameStop Corp. QuoteBy sales mix, hardware and accessories sales fell 31.7% to $345.3 million from $505.3 million in the year-ago quarter. Software sales were $175.6 million, down 26.7% from $239.7 million in the year-ago quarter. Sales in the collectibles unit increased 54.6% to $211.5 million from $136.8 million in the year-ago quarter.By region, United States sales fell 12.9% to $537.5 million from $617.3 million in the year-ago quarter. Canada sales declined 10.3% to $38.2 million from $42.6 million. Australia sales rose 2.9% to $81.9 million from $79.6 million. Europe sales dropped 47.4% to $74.8 million from $142.3 million.Insight Into GME’s Margins & ExpensesGross profit increased 3.4% to $252.8 million from $244.5 million in the year-ago quarter. However, the gross margin expanded 680 basis points (bps) to 34.5% from 27.7% in the first quarter of fiscal 2024.Adjusted selling, general and administrative (SG&A) expenses declined 24.8% to $225.3 million from $299.5 million in the year-ago quarter. As a percentage of net sales, adjusted SG&A expenses were 30.8%, down 320 bps from 34% in the year-ago period.GameStop reported an adjusted EBITDA of $38.6 million against an adjusted EBITDA loss of $37.6 million in the same quarter last year. The company’s adjusted operating income was $27.5 million in the reported quarter against an adjusted operating loss of $55 million in the prior-year period.GME Stock Past 3 Months' Performance Image Source: Zacks Investment Research GME’s Financial Snapshot: Cash, Debt & Equity OverviewGameStop ended the fiscal first quarter with cash and cash equivalents of $6.39 billion, net long-term debt of $1.48 billion, and stockholders’ equity of $4.99 billion. Net merchandise inventory totaled $421.3 million at the end of the fiscal quarter, down from $675.8 million in the same period last year.In the 13 weeks ended May 3, 2025, the net cash flow provided by operations was $192.5 million. The free cash flow for the period totaled $189.6 million, while capital expenditure amounted to $2.9 million.The company finalized the sale of its Canadian operations on May 4, 2025. Between May 3 and June 10, 2025, it acquired 4,710 Bitcoin using cash.In the past three months, shares of this Zacks Rank #3 (Hold) company have risen 37.1% compared with the industry’s 11.5% growth.Key PicksA few better-ranked stocks are Accel Entertainment Inc. ACEL, Roblox Corporation RBLX and Super League Enterprise Inc. SLE.Accel Entertainment is a distributed gaming operator primarily in the United States. The company has a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.The Zacks Consensus Estimate for ACEL’s current financial year’s sales indicates growth of 7.7% from the prior year’s reported figure. The company has a trailing four-quarter average earnings surprise of 16.3%.Roblox develops and operates an online entertainment platform. It currently carries a Zacks Rank of 2. The consensus estimate for Roblox's current financial-year earnings and sales indicates growth of 2.8% and 22.7%, respectively, from the 2024 reported figures. RBLX has a trailing four-quarter average earnings surprise of 16.6%.Super League is a strategically-integrated publisher and creator of games. It has a Zacks Rank of 2 at present. The Zacks Consensus Estimate for Super League’s current financial-year earnings and sales indicates growth of 79.4% and 2.6%, respectively, from the 2024 reported figures. SLE has a negative trailing four-quarter average earnings surprise of 25.4%.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GameStop Corp. (GME): Free Stock Analysis Report Super League Enterprise, Inc. (SLE): Free Stock Analysis Report Accel Entertainment, Inc. (ACEL): Free Stock Analysis Report Roblox Corporation (RBLX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks