GameStop issued preliminary second-quarter earnings, expecting net income to climb even as sales fall. The videogame retailer anticipates net income of $290 million to $310 million for the 13 weeks ended Aug. 1, up from $168.6 million a year earlier, boosted by investment gains from its stake in eBay. The forecast includes about $238 million of net gains related to its eBay derivative asset and equity investment, partially offset by a loss of roughly $75 million on digital assets and related receivables. Net sales are projected between $780 million and $800 million, down from $972.2 million, reflecting the prior-year launch of Nintendo's Switch 2, planned store closures, and the divestiture of its French operations. GameStop also amended a deal to retire $1.4 billion in zero-coupon convertible notes, paying $358.4 million in cash instead of issuing additional shares.
GameStop Corp.GameStop expects higher net income due to investment gains from eBay, despite lower sales.
eBay IncGameStop's earnings forecast includes gains from its eBay investment, but eBay itself is not directly affected.
Nintendo Co., Ltd.