GameStop CFO Weighs In On Better Than Expected Results

GameStop Corp. GME came out with better than expected first-quarter results on Thursday post the market closing, following which shares of the company opened strong on Friday and closed the day with 8 percent gains.

Robert Lloyd, GameStop CFO, was on CNBC recently to weigh in on the company’s earnings.

‘Video Games Are Cyclical’

“We are giving customers what they want,” Lyoyd said. “For us that means that we recognize that there is a growing digital component to the video game business and that video games are cyclical. So, in terms of digital, we expect to do about a billion dollars in digital sales in the next year. In terms of the business being cyclical, we know we need to diversify. We have about 550 stores now selling AT&T and Apple products and services and will grow that store count by about 200 in the next 3 months.”

Other Than Video Games

Lloyd was asked how much of the company’s revenue is coming from categories other than video games and its plan are for the future. He replied, “Well I would say a year from now, we can have about 15 percent of our store base that is in non-video gaming stores. 5 years out, I think, the goal for us is to have about half of our revenue base come from something other than physical video gaming.”

Customers Not Ready For Streaming

On the company leaving the streaming service space, Lloyd said, “We have 40 million members in our loyalty programs around the world and by polling those members we found out that customers were not ready for that kind of streaming service and so for us it didn’t make sense to continue to do that. Sony is introducing a streaming service, which we will sell in our stores and we thought we could participate in the streaming market in that way.”