GameStop stock soars after retailer posts first quarterly profit in 2 years

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GameStop, a video game retailer, has reported losses in all but one of the past 11 quarters leading up to its Q4 2022 earnings report[1].

However, GameStop posted a quarterly profit for the first time in two years

The company’s adjusted earnings leapt to 16 cents per share, compared to a 47-cent loss last year. Net sales dipped slightly to $2.226 billion from $2.25 billion in last year’s fourth quarter

GameStop is still hanging on to $682.9 million in inventory, which is down from $915 million a year ago.

[2]. GameStop is still hanging on to $682.9 million in inventory, which is down from $915 million a year ago.

GameStop’s turnaround plan was reinvigorated by a leadership shake-up in 2021 that put CEO Matt Furlong and Ryan Cohen, Chewy founder and former Bed Bath & Beyond activist investor, at the helm as board chair.

The company has been working to revamp its real estate portfolio and get more online as the video game industry heads in that direction.

Long-term headwinds include potential liquidity challenges and changing gamer preferences with greater appetites for cloud, digital mobile and subscription services.

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