GameStop sales fall, loss narrows; CEO Cohen takes investment helm
GameStop reported mixed third-quarter results and also approved a new investment policy.
In a Form 10-Q filing with the U.S. Securities and Exchange Commission, the video game retailer disclosed that its board approved a policy permitting the company to invest in equity securities and other investments. Game Stop chairman and CEO Ryan Cohen, who took the reins of the company in September, was given the authority to manage the investment portfolio in both public and private markets.
“Depending on certain market conditions and various risk factors, Mr. Cohen, in his personal capacity or through affiliated investment vehicles, may at times invest in the same companies in which the company invests,” Game Stop said. “Such investments align the interests of the company with the interests of related parties because it places the personal resources of Mr. Cohen at risk in substantially the same manner as the company in connection with investment decisions made on behalf of the company.”
Game Stop reported a net loss of $3.1 million, or $0.01 a share, for the quarter ended Oct. 28, compared with a net loss of $94.7 million, or $0.31 a share, in the year-ago quarter.
Net sales fell to $1.078 billion from $1.186 billion. Analysts has expected revenue of $1.182 billion. Net sales in the U.S. fell by 13.3%. Net sales in Australia, and Canada decreased by 16.8% and 9.7%, respectively. Sales in Europe rose 12.8%.
Selling, general and administrative (“SG&A") expenses were $296.5 million, or 27.5% of net sales for the period, compared to $387.9 million, or 32.7% of net sales, in the prior year's third quarter.
GameStop did not a conference call in conjunction with its third-quarter earnings. Instead, it noted that additional information can be found in the company’s Form 10-Q filing. In the filing, the company said that it is focused on “three overarching goals: establishing an omnichannel retail experience, achieving profitability and leveraging brand equity to support growth.”