As suspected… a negative reaction to a company which is now in profit and a tonne of cash reserves.

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GameStop cuts jobs, quarterly revenue falls

Videogame retailer GameStop (GME.N) said on Tuesday it had cut an unspecified number of jobs to reduce costs and reported lower fourth-quarter revenue amid rising competition from e-commerce firms and weak consumer spending in an uncertain economy.

Shares of the Grapevine, Texas-based company tumbled 15% in extended trade after the results.

U.S. videogame publishers Take-Two Interactive Software (TTWO.O) and Electronic Arts (EA.O) also delivered lackluster earnings last month as the gaming industry faces pressure from high borrowing costs, sticky inflation and a slowdown in demand from pandemic peaks.

GameStop posted revenue of $1.79 billion for the fourth quarter, compared with $2.23 billion a year earlier.

The videogame retailer's recent cost-reduction measures also included an exit from its operations in Ireland, Switzerland and Austria. On an adjusted basis, the company reported fourth-quarter earnings per share of 22 cents, compared with 16 cents a year earlier.

GameStop has also been grappling with the ongoing shift to digital sales of video games and competition from online retailers such as Amazon.com (AMZN.O) and Ebay (EBAY.O).

Reporting by Harshita Mary Varghese and Priyanka.G in Bengaluru; Editing by Devika Syamnath

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