GameStop Stock Surges After Earnings, But Amid Issue

Herbie J Pilato

According to journalist Brian Sozzi and Yahoo! Finance, "It was not a clean fourth quarter for GameStop, despite the outpouring of investor affection."

As Sozzi continued to report, "GameStop stock was up 48% in early trading on Wednesday after the company posted its first quarterly profit in two years. The stock is the number one trending ticker on the Yahoo Finance platform."

"GameStop's net profits tallied $48.2 million," Sozzi noted, "...a major swing from a net loss of $147.5 million a year ago."

"At the same time, however," Sozzie clarified, "...the company's sales fell 1.2% from the prior year to $2.23 billion amid continued pressure on software sales and more closed stores. Sales for 2022 dropped 1.4% year-over-year to $5.93 billion. That suggests that GameStop's bottom line surprise was primarily fueled by a push from CEO Matt Furlong to slash costs throughout the organization after several ugly earnings prints."

"Furlong sounded keen to keep sacking employees and watching the bottom line closely as he works to juice profits and the stock price," Sozzie added.

“Looking ahead, we're aggressively focused on year-over-year profitability improvement while still pursuing pragmatic long-term growth," Furlong told Sozzi. "We're taking a number of steps in [the] fiscal year 2023 to improve our efficiency and support these overarching goals. These include continuing to cut excess costs, including in Europe, where we have already initiated exits and partial winds downs in certain countries."

Furlong also told Sozzi that "we expect to continue to incur transformation charges in the first quarter of 2023, as we aggressively cut costs."

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Herbie J Pilato is the author of several books about pop culture including RETRO ACTIVE TELEVISION, THE 12 BEST SECRETS OF CHRISTMAS, MARY: THE MARY TYLER MOORE STORY, TWITCH UPON A STAR, GLAMOUR, GIDGETS AND THE GIRL NEXT DOOR, DASHING, DARING AND DEBONAIR, and NBC & ME: MY LIFE AS A PAGE IN A BOOK, among others. He's also a TV writer/producer, and has worked for Reelz, Bravo, E!, TLC, and hosted THEN AGAIN WITH HERBIE J PILATO, the hit classic TV talk show (which premiered on Amazon Prime in 2019).

Los Angeles, CA

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