GameStop Q1 Loss Narrows; Appoints New CEO, CFO

(RTTNews) – Shares of GameStop Corp. (NYSE: GME) slipped nearly 7% in extended trading hours on Wednesday after the company reported its first-quarter results and announced the appointment of new CEO and CFO.

GameStop reported first-quarter loss of $66.8 million or $1.01 per share, narrower than last year’s loss of $165.7 million or $2.57 per share. Adjusted net loss was $29.4 million or $0.45 per share, narrower than last year’s loss of $157.6 million or $2.44 per share.

Net sales increased 25.1% to $1.28 billion from $1.02 billion last year.

Analysts polled by Thomson Reuters expected a loss of $0.83 per share on revenues of $1.16 billion.

Gross margin dropped 180 basis points to 25.9%, while selling, general and administrative expenses were $370.3 million, a decline of 4.2 from last year.

GameStop also announced the appointment of former Amazon executive Matt Furlong as its new CEO. The company has also tapped in another Amazon executive, Mike Recupero, as chief financial officer.

GameStop, whose stock has surged recently driven by Reddit-inspired hype, is focusing on switching from being a brick-and-mortar retailer to an online retailer. The company is on a hiring spree to as it competes with giants such as Walmart, Sony and Microsoft. In the past few months, the company has hired three former Amazon executives, including Jenna Owens as chief operating officer; Matt Francis as chief technology officer and Elliott Wilke as chief growth officer.

As of May 1, 2021, the company had $770.8 million in cash and restricted cash, compared to $583.9 million in cash and restricted cash in the prior year. Further, the company announced plans sell up to 5 million shares in a secondary offering.

Looking forward, GameStop said it is continuing to suspend guidance at this time.

GME closed Wednesday’s trading at $302.56, up $2.56 or 0.85%, on the NYSE. The stock slipped $25.66 or 8.48% in the after-hours trade.