GameStop(GME) - 2026 Q2 - Quarterly Results

Second Quarter 2025 Results Overview Key Financial Highlights GameStop Corp reported Q2 fiscal 2025 results with significant improvements in net sales, operating income, and net income year-over-year, alongside a substantial increase in cash and digital asset holdings Key Financial Data for Q2 FY2025 | Metric | Q2 2025 (Millions $) | Q2 2024 (Millions $) | YoY Change | | :-------------------------------- | :------------------- | :------------------- | :--------- | | Net Sales | 972.2 | 798.3 | +21.8% | | SG&A Expenses | 218.8 | 270.8 | -19.2% | | Operating Income (Loss) | 66.4 | (22.0) | N/A (Turned to profit from loss) | | Adjusted Operating Income (Loss) | 64.7 | (31.6) | N/A (Turned to profit from loss) | | Net Income | 168.6 | 14.8 | +1039.2% | | Adjusted Net Income | 138.3 | 5.2 | +2560.0% | | Cash, Cash Equivalents & Marketable Securities | 8,700.0 | 4,200.0 | +107.1% | | Bitcoin Holdings | 528.6 | N/A | N/A | Non-GAAP Measures and Other Metrics Definition and Purpose GameStop utilizes non-GAAP metrics to offer additional insight into core operating performance by excluding specific items like transformation costs and asset impairments - GameStop uses non-GAAP measures (Adjusted SG&A, Operating Income/Loss, Net Income/Loss, EPS, Adjusted EBITDA, Free Cash Flow) to supplement GAAP results, providing insight into core operating performance by excluding items like transformation costs, asset impairments, unrealized gains/losses on digital assets, and severance[5][28][37] - Free cash flow, defined as net cash flow from operating activities less capital expenditures, is considered a key financial indicator of the company's ability to generate additional cash from its business operations[5][35] Limitations of Non-GAAP Measures Non-GAAP measures have limitations as they exclude key financial components and may not be comparable to other companies' metrics - Non-GAAP measures have limitations, including not reflecting the company's capital costs and tax structure, cash requirements for capital expenditures or contractual commitments, changes in or cash requirements for working capital needs, and cash requirements for replacing depreciated and amortized assets[37][39] - The company acknowledges its non-GAAP definitions may not be comparable to those of other companies in the industry and emphasizes these measures should not be considered in isolation or as a substitute for GAAP-reported results[38] Condensed Consolidated Financial Statements Condensed Statements of Operations The statements detail revenue, costs, and profitability for the three and twenty-six-week periods, highlighting significant improvements in net sales and gross profit Three Months Ended August 2, 2025 and August 3, 2024 In Q2 2025, GameStop saw substantial net sales growth and a significant profitability turnaround, moving from an operating loss to positive operating income Condensed Statements of Operations (Three Months) | Metric | 13 Weeks Ended Aug 2, 2025 (Millions $) | 13 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net Sales | 972.2 | 798.3 | +21.8% | | Cost of Sales | 689.1 | 549.5 | +25.4% | | Gross Profit | 283.1 | 248.8 | +13.8% | | SG&A Expenses | 218.8 | 270.8 | -19.2% | | Operating Income (Loss) | 66.4 | (22.0) | N/A (Turned to profit from loss) | | Net Income | 168.6 | 14.8 | +1039.2% | | Basic Income per Share | 0.38 | 0.04 | +850.0% | | Diluted Income per Share | 0.31 | 0.04 | +675.0% | Twenty-Six Weeks Ended August 2, 2025 and August 3, 2024 For the first half of fiscal 2025, GameStop achieved modest net sales growth and a significant improvement in overall profitability, turning a net loss into net income Condensed Statements of Operations (Twenty-Six Weeks) | Metric | 26 Weeks Ended Aug 2, 2025 (Millions $) | 26 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net Sales | 1,704.6 | 1,680.1 | +1.5% | | Cost of Sales | 1,168.7 | 1,186.8 | -1.5% | | Gross Profit | 535.9 | 493.3 | +8.6% | | SG&A Expenses | 446.9 | 565.9 | -21.0% | | Operating Income (Loss) | 55.6 | (72.6) | N/A (Turned to profit from loss) | | Net Income (Loss) | 213.4 | (17.5) | N/A (Turned to profit from loss) | | Basic Income (Loss) per Share | 0.48 | (0.05) | N/A (Turned to profit from loss) | | Diluted Income (Loss) per Share | 0.42 | (0.05) | N/A (Turned to profit from loss) | Condensed Statements of Operations by Segment This section details operating performance by geographic segment for the three and twenty-six-week periods, highlighting regional contributions to net sales and operating income Three Months Ended August 2, 2025 and August 3, 2024 In Q2 2025, the U.S. segment drove significant growth in net sales and operating income, while Australia also saw increases and Europe reported an operating loss Statements of Operations by Segment (Three Months) | Segment | Q2 2025 Net Sales (Millions $) | Q2 2024 Net Sales (Millions $) | YoY Change | Q2 2025 Operating Income (Loss) (Millions $) | Q2 2024 Operating Loss (Millions $) | | :-------- | :----------------------------- | :----------------------------- | :--------- | :------------------------------------------- | :---------------------------------- | | United States | 724.6 | 545.6 | +32.8% | 63.7 | (1.5) | | Canada | — | 37.7 | -100.0% | — | (4.2) | | Australia | 140.9 | 87.8 | +60.5% | 6.0 | (5.9) | | Europe | 106.7 | 127.2 | -16.2% | (3.3) | (10.4) | | Total | 972.2 | 798.3 | +21.8% | 66.4 | (22.0) | - The company divested its operations in Canada during the second quarter of fiscal 2025, resulting in no reported sales or operating income for the segment in Q2 2025[30][32] Twenty-Six Weeks Ended August 2, 2025 and August 3, 2024 In the first half of 2025, the U.S. segment showed strong net sales growth and a significant turnaround to operating income, while asset impairments were recorded for divestitures Statements of Operations by Segment (Twenty-Six Weeks) | Segment | YTD 2025 Net Sales (Millions $) | YTD 2024 Net Sales (Millions $) | YoY Change | YTD 2025 Operating Income (Loss) (Millions $) | YTD 2024 Operating Loss (Millions $) | | :-------- | :------------------------------ | :------------------------------ | :--------- | :-------------------------------------------- | :----------------------------------- | | United States | 1,262.1 | 1,162.9 | +8.5% | 97.3 | (26.9) | | Canada | 38.2 | 80.3 | -52.4% | (22.2) | (8.6) | | Australia | 222.8 | 167.4 | +33.1% | 0.6 | (14.0) | | Europe | 181.5 | 269.5 | -32.6% | (20.1) | (23.1) | | Total | 1,704.6 | 1,680.1 | +1.5% | 55.6 | (72.6) | - Asset impairments of $33.4 million were incurred due to plans to divest operations in Canada and France, with the Canadian divestiture completed in Q2 fiscal 2025[15][30][32] Condensed Consolidated Balance Sheets As of August 2, 2025, the balance sheet shows a substantial increase in total assets, driven by growth in cash and the introduction of digital assets Condensed Consolidated Balance Sheets | Metric | August 2, 2025 (Millions $) | August 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------- | :-------------------------- | :--------- | | Total Assets | 10,341.1 | 5,536.3 | +86.8% | | Cash and Cash Equivalents | 8,694.4 | 4,193.1 | +107.4% | | Merchandise Inventories, net | 484.9 | 560.0 | -13.4% | | Digital Assets | 528.6 | — | N/A | | Total Liabilities | 5,164.7 | 1,152.9 | +348.0% | | Long-term Debt, net | 4,160.9 | 12.4 | +33455.6% | | Total Stockholders' Equity | 5,176.4 | 4,383.4 | +18.1% | Condensed Consolidated Statements of Cash Flows The statements show cash flows from operating, investing, and financing activities, highlighting significant cash inflows from financing and a large increase in cash Three Months Ended August 2, 2025 and August 3, 2024 In Q2 2025, operating cash flow increased, while investing activities saw a net outflow due to digital asset purchases, and financing activities provided significant inflows Condensed Consolidated Statements of Cash Flows (Three Months) | Metric | 13 Weeks Ended Aug 2, 2025 (Millions $) | 13 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net Cash Flows from Operating Activities | 117.4 | 68.6 | +71.1% | | Net Cash Flows (Used in) Provided by Investing Activities | (523.3) | 78.4 | N/A (Turned to outflow) | | Net Cash Flows Provided by Financing Activities | 2,675.3 | 3,052.9 | -12.4% | | Increase in Cash, Cash Equivalents, and Restricted Cash | 2,309.8 | 3,199.5 | -27.8% | | Cash, Cash Equivalents and Restricted Cash at End of Period | 8,733.9 | 4,217.0 | +107.1% | - Investing activities in Q2 2025 included $500.0 million in purchases of digital assets[20] - Financing activities in Q2 2025 included $2,700.0 million from the issuance of convertible debt, compared to $3,070.4 million from ATM offerings in Q2 2024[20] Twenty-Six Weeks Ended August 2, 2025 and August 3, 2024 For the first half of 2025, operating cash flow improved significantly, turning from an outflow to an inflow, while financing activities provided substantial cash Condensed Consolidated Statements of Cash Flows (Twenty-Six Weeks) | Metric | 26 Weeks Ended Aug 2, 2025 (Millions $) | 26 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net Cash Flows from Operating Activities | 309.9 | (41.2) | N/A (Turned to inflow) | | Net Cash Flows (Used in) Provided by Investing Activities | (516.0) | 268.2 | N/A (Turned to outflow) | | Net Cash Flows Provided by Financing Activities | 4,153.3 | 3,050.2 | +36.2% | | Increase in Cash, Cash Equivalents, and Restricted Cash | 3,944.1 | 3,278.1 | +20.3% | | Cash, Cash Equivalents and Restricted Cash at End of Period | 8,733.9 | 4,217.0 | +107.1% | - Year-to-date investing activities included $500.0 million in purchases of digital assets[22] - Year-to-date financing activities included $4,200.0 million from the issuance of convertible debt[22] Sales Mix Analysis (Schedule I) Three Months Ended August 2, 2025 and August 3, 2024 In Q2 2025, the share of net sales from hardware & accessories and collectibles increased significantly, while software's contribution declined Sales Mix (Three Months) | Product Category | Q2 2025 Net Sales (Millions $) | Q2 2025 % of Total | Q2 2024 Net Sales (Millions $) | Q2 2024 % of Total | YoY Sales Change | | :----------------------- | :----------------------------- | :----------------- | :----------------------------- | :----------------- | :--------------- | | Hardware and accessories | 592.1 | 60.9% | 451.2 | 56.5% | +31.2% | | Software | 152.5 | 15.7% | 207.7 | 26.0% | -26.6% | | Collectibles | 227.6 | 23.4% | 139.4 | 17.5% | +63.3% | | Total | 972.2 | 100.0% | 798.3 | 100.0% | +21.8% | Twenty-Six Weeks Ended August 2, 2025 and August 3, 2024 For the first half of 2025, the share of collectibles in total net sales grew substantially, while software's contribution decreased Sales Mix (Twenty-Six Weeks) | Product Category | YTD 2025 Net Sales (Millions $) | YTD 2025 % of Total | YTD 2024 Net Sales (Millions $) | YTD 2024 % of Total | YoY Sales Change | | :----------------------- | :------------------------------ | :------------------ | :------------------------------ | :------------------ | :--------------- | | Hardware and accessories | 937.4 | 55.0% | 956.5 | 57.0% | -2.0% | | Software | 328.1 | 19.2% | 447.4 | 26.6% | -26.7% | | Collectibles | 439.1 | 25.8% | 276.2 | 16.4% | +59.0% | | Total | 1,704.6 | 100.0% | 1,680.1 | 100.0% | +1.5% | Non-GAAP Reconciliations (Schedule II & III) Adjusted SG&A, Operating Income, Net Income, and EPS Reconciliations show adjusted SG&A, operating income, net income, and EPS were significantly higher than GAAP figures after adjustments for specific items Adjusted SG&A, Operating Income, Net Income, and EPS | Metric | 13 Weeks Ended Aug 2, 2025 (Millions $) | 13 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | 26 Weeks Ended Aug 2, 2025 (Millions $) | 26 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | :-------------------------------------- | :-------------------------------------- | :--------- | | SG&A expense (GAAP) | 218.8 | 270.8 | -19.2% | 446.9 | 565.9 | -21.0% | | Adjusted SG&A expense | 218.4 | 280.4 | -22.1% | 443.7 | 579.8 | -23.4% | | Operating income (loss) (GAAP) | 66.4 | (22.0) | N/A | 55.6 | (72.6) | N/A | | Adjusted operating income (loss) | 64.7 | (31.6) | N/A | 92.2 | (86.5) | N/A | | Net Income (loss) (GAAP) | 168.6 | 14.8 | +1039.2% | 213.4 | (17.5) | N/A | | Adjusted net income (loss) | 138.3 | 5.2 | +2560.0% | 219.2 | (31.4) | N/A | | Adjusted Basic EPS | 0.31 | 0.01 | +3000.0% | 0.49 | (0.09) | N/A | | Adjusted Diluted EPS | 0.25 | 0.01 | +2400.0% | 0.43 | (0.09) | N/A | - Adjustments primarily include transformation costs, asset impairments related to the Canada and France divestitures, and unrealized gains on digital assets[29][30] Adjusted EBITDA Adjusted EBITDA for the three and twenty-six-week periods showed a significant positive turnaround compared to the prior year after various adjustments Adjusted EBITDA | Metric | 13 Weeks Ended Aug 2, 2025 (Millions $) | 13 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | 26 Weeks Ended Aug 2, 2025 (Millions $) | 26 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net income (loss) (GAAP) | 168.6 | 14.8 | +1039.2% | 213.4 | (17.5) | N/A | | EBITDA | 99.7 | (14.4) | N/A | 96.7 | (48.2) | N/A | | Adjusted EBITDA | 75.7 | (18.0) | N/A | 114.3 | (49.2) | N/A | - Adjustments to EBITDA include interest income, depreciation and amortization, income tax expense, stock-based compensation, transformation costs, divestitures, asset impairments, and unrealized gains on digital assets[31] Free Cash Flow GameStop generated positive free cash flow for both the three and twenty-six-week periods, a significant improvement from the negative cash flow in the prior year Free Cash Flow | Metric | 13 Weeks Ended Aug 2, 2025 (Millions $) | 13 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | 26 Weeks Ended Aug 2, 2025 (Millions $) | 26 Weeks Ended Aug 3, 2024 (Millions $) | YoY Change | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :--------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net cash flows provided by (used in) operating activities | 117.4 | 68.6 | +71.1% | 309.9 | (41.2) | N/A | | Capital expenditures | (4.1) | (3.1) | +32.3% | (7.0) | (8.0) | -12.5% | | Free cash flow | 113.3 | 65.5 | +73.0% | 302.9 | (49.2) | N/A | Cautionary Statement Regarding Forward-Looking Statements Cautionary Statement Regarding Forward-Looking Statements This section serves as a legal disclaimer, advising that forward-looking statements are subject to significant risks and uncertainties that could cause actual results to differ - This press release contains forward-looking statements, identifiable by words like "anticipates," "expects," or "will," which are subject to significant risks and uncertainties[7] - Actual developments, business decisions, results, and outcomes may differ materially due to factors such as economic conditions, industry competition, supply chain disruptions, technological advances, reliance on new products, and risks associated with investment holdings, including Bitcoin volatility[7] - The company undertakes no obligation to publicly update any forward-looking statements, except as may be required by applicable securities laws[7]