Video game retailer GameStop has released its latest quarterly report, and it was a banner period for the company.
GameStop posted a quarterly profit of $389.6 million for its fiscal Q1, and that was the highest-ever quarterly profit in the company’s history. This compares to a profit of $44.8 million for the same period last year.
Revenue surged as well, rising from $732.4 million during Q1 last year to $835.3 million this year. GameStop also continued to cut costs, with selling, general, and administrative costs falling from $228.1 million to $201.6 million.
GameStop’s stock price is surging in after-hours trading, jumping by more than 7% and boosting GameStop’s market cap by billions. It may settle back down tomorrow, however.
GameStop has made dramatic, deep cuts to return to profitability. This has included layoffs, store closures, selling off the Game Informer magazine, and other cost-cutting measures.
GameStop also announced that it now has $9.7 billion in assets on hand. That is a figure people will no doubt point to as GameStop continues to try to buy eBay for many multiples more than the amount of money it has. GameStop CEO Ryan Cohen has said he’s secured $20 billion in financing from TD and could look to get more funding from Middle-East sources to buy eBay.
For its part, eBay has flatly rejected GameStop’s buyout proposal. Cohen has said he may go direct to eBay’s shareholders and pursue a hostile takeover.
GameStop no longer conducts earnings calls, so we won’t hear from Cohen or other management regarding the Q1 results or the latest in the eBay saga today.
In other GameStop news, the company is hosting a “1v1 Me Bro” Halo 3 tournament on June 6, and the top prize is a legendary console.
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