Game Stop Corp. (NYSE: GME), the world's largest video-game retailer, said on Wednesday that its first quarter profit more than doubled in part on strong Nintendo product sales, but just missed analyst expectations.
The Grapevine, Texas-based retailer's net income rose to $24.7 million, or 15 cents a share, from $11.7 million, or 7 cents a share, compared to a year ago. Sales also were up 23 percent to $1.28 billion.
On average, analysts polled by Thomson Financial expected earnings of 16 cents a share on revenue of $1.25 billion.
The earnings included a charge of $6.7 million, or 3 cents per share, due to costs for debt retirement.
Game Stop said comparable store sales - a key industry metric - increased 15.3 percent on strong demand for next generation game consoles.
Hardware sales grew 75.1 percent in the quarter, driven by overwhelming demand for Nintendo's Wii and DS Lite systems, and strong sales of Microsoft's Xbox 360 and Sony's PS3, it said.
For much of the quarter, seven different platforms were represented among our top 25 best sellers, said R. Richard Fontaine, the company's Chairman and CEO. Not only was this unprecedented, but there is every indication that the Wii and DS Lite titles are attracting a new audience of gamers.
The top selling video games during the quarter were Nintendo's Pokemon Diamond, and Pearl, Sony's God of War II, and Activision's Guitar Hero II, among others.
The company expects earnings of 7 to 8 cents per share in the current quarter, and same store sales to increase by 16 to 18 percent and raised its full-year guidance to $1.39 to $1.42 a share, from $1.37 to $1.40 a share.
Shares of Gamestop lost $1.51, or 4 percent to reach $36.92 afternoon trading on the New York Stock Exchange.