GameStop’s Q3 results buoyed by hit game sales

While other companies are screaming that the sky is falling, retailer GameStop said Thursday that sales of hot game titles helped boost its third-quarter profits by nearly 12 percent and offset a sales decline for video game hardware in the quarter. These profits just barely helped the company beat Wall Street expectations. Excluding costs, GameStop’s operating profit of 32 cents per share beat a forecast of 30 cents per share.

Net earnings for the quarter that ended on Oct. 13 were $52.2 million - 31 cents per share, up from a profit of $46.7 million - 28 cents per share, in the same period a year ago. Sales in the quarter climbed 8.2 percent to $1.83 billion; analysts estimated $1.73 billion. A year ago the company raked in $1.7 billion.

Sales of new software rose 9.4 percent, and sales of used products jumped 19 percent. These gains helped offset a decline in sales of new video game hardware. But sales at stores open at least a year, which is considered a measure of a retailer’s financial health — fell 7.8 percent. That’s in line with forecast the company offered last week - a decline of 6 - 11 percent.

So what games pulled GameStop’s fanny out of the fire this quarter? According to the company, Madden NFL 10, Halo 3: ODST, Batman: Arkham Asylum, NBA 2K10 and Nintendo’s Wii Sports Resort. Call of Duty: Modern Warfare 2 sold more than 2.5 million copies worldwide in its first 72 hours of release as well.

For the fourth quarter, GameStop expects a profit of $1.47 - $1.65 per share; analysts forecast Q4 profits at $1.57.

Activision Q3 Profits up on Guitar Hero, Call of Duty

Activision Blizzard announced a profit for the third quarter, thanks to two important events: a reduction in costs and strong sales of titles like Guitar Hero 5. Shares rose 2 percent in afternoon trading on the news. The company also predicted lower fourth quarter numbers than what Wall Street expected, despite the pending release of Call of Duty: Modern Warfare 2, which ships next Tuesday.

For the third quarter, Activision reported a net income of $15 million - 1 cent per share - compared with a net loss of $108 million - 8 cents a share, for the same period a year ago. Net revenue dipped 1 percent in Q3 to $703 million. Excluding revenue that was deferred from the sale of certain titles, the company said revenue for the period would have been right around $755 million.

In the quarter Activision Blizzard increased its U.S. and European share 1.2 points over the previous year across all platforms to 12.3 percent and had two of the top-10 best-selling titles in the U.S.: Guitar Hero 5 and Guitar Hero World Tour, according to retail sales data from NPD Group (U.S.) and Charttrack and Gfk (Europe).

The top selling games for the quarter were Guitar Hero 5, Marvel: Ultimate Alliance 2, and older versions of Guitar Hero, Call of Duty and - of course - World of Warcraft.

For the fourth quarter, Activision is predicting earnings of 43 cents a share on revenue of $2.22 billion, on a non-GAAP basis. Analysts were expecting earnings of 44 cents a share on revenue of $2.3 billion. The fourth quarter will include the release of Modern Warfare 2, Tony Hawk: Ride, DJ Hero and Band Hero.

GameStop takes a haircut in Q2 2009

It’s not a good day for retailer GameStop, who reported a decline in profits for the second quarter ended August 1, 2009. GameStop’s sales for the quarter were $1.74 billion, down 3.7 percent compared to sales of $1.80 billion in the same period a year ago. The drop in profits can be attributed to less consumer spending on video games and hardware - lower console sales, a lack of strong new software titles and customer caution due to the U.S. economy.

The top five selling games during the quarter were THQ’s UFC 2009 Undisputed, Activision’s Prototype, EA’s Fight Night Round 4 and NCAA Football 2010, and Atari’s Ghostbusters.

Looking ahead, GameStop expects to record lower profits, mainly due to many games being pushed to 2010 like Bioshock 2, StarCraft II and Splinter Cell: Conviction.

For the third quarter of fiscal 2009, GameStop is forecasting diluted earnings per share to range from $0.27 to $0.33, and for the fourth quarter diluted earnings per share from $1.47 to $1.65. For fiscal 2009, GameStop is lowering diluted earnings per share guidance from the previous range of $2.83 to $2.93 to a range of $2.40 to $2.64.

Capcom reports record first quarter results

Capcom’s first quarter 2009 financial results are good news for the worldwide publisher, with net sales of 19.4 billion yen ($204.6 million USD) - up 19.2 percent from the same period last year; operating income of 3.6 billion yen ($38.4 million USD) - up 23.0 percent from the period last year; and income of 4.1 billion yen - up 2.3 percent from the same period last year.

Resident Evil 5 continued to show sales grow with life-to-date shipment of 5.5 million, and Monster Hunter Freedom Unite also enjoyed prolonged sales - shipping a total of 3.5 million in Japan. Ace Attorney INVESTIGATIONS: Miles Edgeworth and - Sengoku BASARA Battle Heroes both made favorable showings in Japan. Capcom was not as pleased with games that they expected to better in Western markets like Bionic Commando - which moved 550,000 units for PlayStation 3 and Xbox 360 and Monster Hunter Freedom Unite for PlayStation Portable, which Capcom said showed weak performance.

Capcom also announced plans to delay Dark Void from a Christmas release window into the first quarter of 2010. Capcom also predicts that Lost Planet 2, due for release by year’s end, will sell 2.7 million units.

THQ profits climb on UFC and Red Faction

For the fiscal first quarter ended June 30, 2009, THQ said that its net sales climbed 77 percent to $243.5 million from $137.6 million in the prior year. On a non-GAAP basis, for the three month period that ended June 30, 2009, the company reported net sales of $233.9 million, up 93 percent from $121.1 million a year ago. Fiscal 2010 first quarter net sales were driven primarily by UFC 2009 Undisputed and internally developed and owned intellectual property Red Faction: Guerrilla.

For the three months ended June 30, 2009, the company reported net income of $6.4 million, or $0.09 per share, compared with a net loss of $27.2 million, or $0.41 per share, in the prior year. On a non-GAAP basis, for the three months ended June 30, 2009, the company reported net income of $6.9 million, or $0.10 per diluted share, compared with a non-GAAP net loss of $25.4 million, or $0.38 per share, in the same quarter a year ago.

Yesterday THQ announced that it prevailed in a binding arbitration with JAKKS Pacific. The arbitrator established a new preferred return payment rate to JAKKS Pacific for WWE video games sold under a license granted by World Wrestling Entertainment. to THQ/JAKKS Pacific LLC. The new rate, which is 40 percent below the previous rate, is effective as of July 1, 2006 and applies through December 31, 2009. As a result, the company expects to report a one-time benefit of approximately $23 million during the fiscal 2010 second quarter ending September 30, 2009, and to reduce its accrued venture partner expense on its balance sheet by the same amount.

Looking ahead, the company expects fiscal 2010 net sales to exceed those reported in fiscal 2009, on a non-GAAP basis, compared with its previous expectations of fiscal 2010 net sales that approximated fiscal 2009 net sales. The company also expects to achieve profitability for fiscal 2010, on a non-GAAP basis, compared with its previous goal of targeting profitability for the year. The company reaffirmed its expectation that its fiscal 2010 year-end cash balance will be at least $50 million higher than at the end of fiscal 2009, excluding payments currently payable to JAKKS Pacific.

THQ has no new titles scheduled for release during the fiscal 2010 second quarter. It expects to report net sales in the range of $85-$95 million, on a non-GAAP basis, compared with $151.6 million in the prior-year period. As a result of the company’s cost cutting efforts, THQ expects to report a smaller operating loss, on a non-GAAP basis, than reported in the same quarter last year. The second quarter and full year non-GAAP outlooks exclude the expected one-time benefit of approximately $23 million from the JAKKS arbitration.

THQ reveals FY 2009 line-up

As part of its fiscal first quarter financial results for the period ending June 30, THQ released its releases scheduled for the remainder of fiscal 2010, divided into three categories: Core; Kids, Family and Casual Games; and Online Games. THQ’s Fiscal Year 2009 will end in March 2010. The complete list can be found below:

Core Games:

Darksiders - Xbox 360, PLAYSTATION 3

MX vs. ATV Reflex - Xbox 360, PLAYSTATION 3, Nintendo DS, PSP

Red Faction: Guerrilla - Windows PC

WWE SmackDown vs. Raw 2010 - Xbox 360, PLAYSTATION 3, Wii, Nintendo DS, PlayStation 2, PSP

Kids, Family and Casual Games:

All Star Cheer Squad 2 - Wii

Disney|Pixar’s Up (international markets) - Xbox 360, PLAYSTATION 3, Wii, Nintendo DS, PlayStation 2, PSP, Windows PC

Disney|Pixar’s Cars Race-O-Rama - Xbox 360, PLAYSTATION 3, Wii, Nintendo DS, PlayStation 2, PSP

Drawn to Life: The Next Chapter - Wii, Nintendo DS

James Patterson’s Women’s Murder Club: Games of Passion - Nintendo DSi, DS

Marvel Super Hero Squad - Wii, Nintendo DS, PlayStation 2, PSP

SpongeBob Truth or Square - Xbox 360, Wii, Nintendo DS, PSP

The Biggest Loser - Wii, Nintendo DS

World of Zoo - Wii, Nintendo DS, Windows PC

Online:

Company of Heroes Online - Windows PC

Dragonica Online - Windows PC

SouthPeak profits up on X-Blades, Big Bang Mini

SouthPeak Interactive announced financial results for the third quarter ended March 31, 2009. For the three month period that ended on March 31, SouthPeak reported revenues of $13.5 million, a decent jump from $2.2 million for the same period a year ago.

Earnings before interest, taxes, depreciation and amortization, as adjusted (”Adjusted EBITDA”), was $825,000 as compared to Adjusted EBITDA of $142,000 in the same period a year agor. The non-GAAP net income for the quarter was $566,000, compared to non-GAAP net income of $20,000 in the same period a year ago.

The company says that these results reflect “strong momentum across all platforms,” driven in by post-holiday demand and several new releases during the quarter including Big Bang Mini for DS and X-Blades for multiple platforms. For the quarter the number of videogames sold were 711,000 units, an increase of 497,000 units.

Looking ahead, Southpeak has over 60 titles in development for multiple platorms including PS3, PSP, Xbox 360, Wii, DS, PC and iPhone. Expect to hear about many of these titles very soon at E3.