GameStop is making profits despite declining sales

GameStop (GME) posted a profit in the third quarter even though sales fell year-over-year. Shares rose sharply in extended trading on Tuesday on the news.

The video game retailer had a profit of $17.4 million, or 4 cents per share, on revenue of $860.3 million, compared with a loss of $3.1 million, or 1 cent per share, on revenue from $1.08 billion a year ago.

GameStop is not widely covered by Wall Street, with Wedbush’s Michael Pachter being the only analyst covered by Visible Alpha. In a note Friday, he reiterated an “underperform” rating and $10 price target on the stock, writing that “the company’s planned return to growth faces insurmountable obstacles.”

GameStop was once again in the meme stock spotlight last week when a cryptic post emerged

GameStop shares, which rose over 10% in extended trading, were up about 54% for 2024 through Tuesday’s close. Most of the gains this year came in May and June after Gill posted multiple times about the retailer for the first time since the emoji trading wave in late 2020 and early 2021.