GameStop sales nearly double

Last weekend was one of the biggest of the year for gaming retail, with Friday's PlayStation 3 launch followed on Sunday by Nintendo's release of the Wii. However, specialty retailer GameStop today reported its financial results for its third quarter of the fiscal year 2006, and it appears the company was doing well even before the new systems came along.

For the 13 weeks ended October 28, GameStop reported sales of just over $1 billion, an 89 percent jump over the $534 million it reported for the same quarter last year. The company's comparable store sales were up 8.8 percent for the time frame, beating expectations of a 4 to 6 percent jump.

The surge was attributed to strong sellers among new games like Electronic Arts' Madden NFL 07, THQ's Saints Row, Capcom's Dead Rising, and Ubisoft's Splinter Cell Double Agent. Sales of the Xbox 360 and DS Lite were also brisk, as the company said hardware revenues were up 69 percent over the year before.

While GameStop's revenues beat expectations, its profits were another story. The company reported a net profit of about $13.6 million (which works out to a diluted earnings per share of about 18 cents), falling short of expectations that had been pegged at a diluted 20 to 22 cents per share.

For the current quarter, GameStop expects comparable store sales to be up 14 to 18 percent from last year, with earnings per share between $1.53 and $1.59.

Investors reacted positively to the retailer's results, with GameStop shares trading up a little more than $2 (4 percent), at $53.51, as of press time.