Core Highlights: - Net loss of $17.5 million for the six months ended August 3, 2024, compared to a net loss of $53.3 million in the prior year period - Gross profit margin increased to 29.4% from 24.7% in the prior year, primarily due to improvements in inventory management - Net sales decreased 30.0% to $1.68 billion, driven by declines across hardware, software and collectible sales
Revenue Breakdown: Hardware and accessories: - Revenue decreased 24.4% to $451.2 million for Q2 and 27.7% to $956.5 million for the six month period, driven by lower demand across the industry Software: - Revenue decreased 47.7% to $207.7 million for Q2 and 39.2% to $447.4 million for the six month period due to fewer major title releases Collectibles: - Revenue decreased 17.9% to $139.4 million for Q2 and 19.4% to $276.2 million for the six month period, reflecting lower demand
Management Outlook: Management continues to focus on optimizing the core business, including: - Establishing omnichannel retail excellence by increasing product availability and faster fulfillment - Achieving profitability through continued cost containment efforts like closing underperforming stores - Leveraging the GameStop brand and store network to support growth initiatives
Operating Data: - SG&A expenses decreased 16.0% for Q2 and 15.3% for the six month period, driven by labor, consulting and marketing cost reductions as well as benefits from legal settlements - Operating loss was $22.0 million for Q2 and $72.6 million for the six month period - Cash and cash equivalents were $4.19 billion at quarter-end, bolstered by $3.06 billion in net proceeds from the ATM equity offering in Q2
Operational Risks: Key risks include: - Supply chain disruptions impacting product availability - Declines in consumer demand and spending on gaming products - Competitive pressure from rivals and new entrants - Execution risks around the business transformation and cost optimization initiatives

Original Filing