GameStop Q2 Earnings Preview: Analyst Estimates, Return To Profitability In Focus

Analysts' Expectations For GameStop's Q2 Earnings

Analysts are expecting GameStop to report a loss per share of $0.75 in the second quarter of 2023, according to data from Refinitiv. This would be an improvement from the loss per share of $1.86 reported in the same period last year. Revenue is expected to come in at $1.25 billion, up from $1.18 billion in the second quarter of 2022.

Key Metrics To Watch

* Revenue: Analysts will be looking at GameStop's revenue growth to gauge the health of its core business. * Same-store sales: This metric measures sales at stores that have been open for at least a year. It is a key indicator of the company's ability to attract and retain customers. * Gross margin: This metric measures the profitability of GameStop's sales. It is calculated by dividing gross profit by revenue. * Net income: This metric measures GameStop's overall profitability. It is calculated by subtracting expenses from revenue.

GameStop's Path To Profitability

GameStop has been working to improve its profitability in recent years. The company has closed unprofitable stores, reduced its workforce, and invested in new initiatives such as e-commerce and digital gaming. These efforts have helped GameStop to narrow its losses in recent quarters. In the first quarter of 2023, GameStop reported a loss per share of $0.69, an improvement from the loss per share of $1.39 reported in the same period last year. Revenue came in at $1.27 billion, up from $1.13 billion in the first quarter of 2022. GameStop is expected to continue to improve its profitability in the second quarter of 2023. Analysts are expecting the company to report a smaller loss per share than in the same period last year. GameStop is also expected to generate more revenue in the second quarter of 2023 than in the second quarter of 2022.

Investors Will Be Watching For Updates On Cash Plans

GameStop has been burning through cash in recent years. The company had $894 million in cash and cash equivalents at the end of the first quarter of 2023, down from $1.27 billion at the end of 2022. Investors will be looking for updates on GameStop's cash plans in the second quarter earnings report. The company may need to raise additional capital in the future if it continues to burn through cash.

Conclusion

GameStop's second quarter earnings report will be closely watched by analysts and investors. The company is expected to report a smaller loss per share than in the same period last year, but investors will be looking for signs that GameStop is on track to return to profitability. The company's cash plans will also be a key focus for investors.