GameStop Stock Edges Lower As Investors Weigh Revenue Decline, Bigger Cash Pile

GameStop Corp (NYSE:GME) shares are trading marginally lower Friday morning as investors continued to react to the company's fourth-quarter results, which were released after the close on Tuesday and showed a mixed top-line and bottom-line picture.

While revenue came in below Wall Street estimates and declined from the prior year, the company posted an earnings beat, improved operating income and ended the quarter with a significantly larger cash position. Here’s what investors need to know.

• GameStop stock is showing downward bias. Where is GME stock headed?

GameStop Earnings Beat Offset By Revenue Miss

GameStop reported fourth-quarter revenue of $1.10 billion, missing analyst estimates of $1.47 billion and down from $1.28 billion in the same quarter last year. Adjusted earnings came in at 49 cents per share, ahead of estimates for 37 cents per share.

Operating income rose to $135.2 million from $79.8 million a year earlier, while selling, general and administrative expenses declined to $241.5 million from $282.5 million. Revenue weakness was driven by declines in hardware and software sales, although collectibles revenue increased to $365 million from $270.6 million.

GameStop Cash Position, Bitcoin Holdings Stay In Focus

Investors may also be responding to the company's balance sheet. GameStop said it ended the quarter with about $9 billion in cash, cash equivalents and marketable securities, up from $4.8 billion a year earlier. The company also disclosed Bitcoin (CRYPTO: BTC) holdings valued at $368.4 million at quarter-end.

Full-year operating income turned positive at $232.1 million versus an operating loss last year, reinforcing the view that cost controls and capital strength remain central to the story.

GME Shares Edge Lower Friday Morning

GME Price Action: GameStop shares were down 0.75% at $22.39 at the time of publication on Friday, according to Benzinga Pro data.

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