GameStop (NYSE:GME) announced after the market closed on Thursday that it expects to see global revenue for its quarter ended May 2 to fall between 33% and 35% from the $1.5 billion it recorded in the year-ago period.
Over three-quarters of the video game retailer's 1,800 international stores have been closed since March when the COVID-19 pandemic struck, and all of its 3,500 U.S. stores were closed as well. However, about two-thirds of the domestic locations offered limited curbside pickup for online orders, helping to offset the worst impacts of the coronavirus outbreak.
A new game to play
GameStop said comparable store sales are expected to fall 30% or more in the quarter and it anticipates reporting that hardware sales accounted for a larger percentage of total revenue than software sales, a reversal from last year.
As consumers were stuck at home with little else to do, video games soared in popularity. Market researchers at NPD Group said beginning in March, hardware sales for the industry surged 63% for the month compared to a year ago while software jumped 34% and accessories rose 12%. Earnest Research said online sales through GameStop's website soared 1,500% between March 1 and April 10.
CEO George Sherman said in a statement, "Despite the disruption caused by the pandemic, we are pleased to see our strategic investments in omnichannel capabilities allow us to deliver on the increased demand for gaming, entertainment and remote work products."
GameStop currently faces a proxy battle with activist investors who charge the retailer with destroying $2.5 billion in shareholder value.