Investors didn’t think GameStop’s start to the year was all too fun. Shares of the retailer of videogames, wireless devices and collectable toys plunged as much as 6% on Friday after reporting same-store sales at its core gaming retail stores fell 6.2% due to weak demand for new consoles and videogames. Same-store sales for GameStop’s videogame business in the important U.S. market, which numbers over 3,900 stores, declined 6.6%. Sales at GameStop’s international games division, which boasts over 2,000 stores across Canada, Australia and Europe, declined by a more modest 4.9%. GameStop delivered first quarter earnings of 66 cents a share, beating Wall Street estimates for 62 cents a share. For the second quarter, the company forecasted a revenue decline 1% to 4% and earnings of 23 cents a share to 30 cents a share. Wall Street had anticipated 33 cents a share. Given the performance of the videogame market recently, GameStop’s results and second quarter outlook shouldn’t exactly come as a surprise. Gamers spent $509.5 million on video game hardware and software-related products in the U.S. in April, a 15% year-over-year decline from the $598.1 million they spent last year. Hardware sales fell 23% to $142.1 million from $183.7 million, while software sales declined 21% to $203.9 million from $256.7 million. Game and console accessory sales were a bright spot in an otherwise bleak April, rising 4% to $157.6 million. The trajectory of GameStop’s games business could change real soon though. GameStop Chief Operating Officer Tony Bartel told TheStreet in an interview that he has high hopes for Nintendo’s new console code-named NX that is scheduled to hit markets in March 2017. Bartel also didn’t rule out Microsoft and Sony unveiling new, more powerful gaming consoles at next month’s E3 gaming convention. ‘We expect to hear a lot of about virtual reality [next month], which will be a massive category,’ added Bartel. But, not all was bad for GameStop in the first three months of the year as it continued to show promise with the new businesses it’s banking on for long-term growth. Sales in the company Technology Brands segment, which includes sales of wireless devices through Spring Mobile’s over 900 AT&T stores, increased 62.2% to $165.8 million. Profit for the segment surged 506% from the prior year to $18.8 million. By 2019, GameStop expects Technology Brands to deliver approximately $1.6 billion of sales, up from about $265 million last year, fueled by the opening of more AT&T branded stores. Meanwhile, sales of collectibles such as Pop! Games mini dolls rose over 250% driven by the acquisition of ThinkGeek.com and interest in Five Nights at Freddy’s products, Pok
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