GameStop Corp. announced results for the fiscal third quarter ended Oct. 31, which included a 30.2% year-over-year fall in revenue that missed the analyst consensus by 7.7%. Panjiva's data for U.S. seaborne imports associated with the company shows imports by volume increased 34.0% in the three months to Oct. 31, corresponding with GameStop's third quarter, while recent data for November shows a 176.9% year-over-year increase.
The company's imports follow a highly seasonal pattern, peaking in October, which likely correlates with the holiday shopping season. The seasonality of imports in 2020 was flattened versus the normal pattern, perhaps representing early ordering to ensure availability.
CEO George Sherman alluded to disruptions, stating, "to some extent, supply chain disruptions is now segueing into what we see as a period of sustained growth." Further analysis shows that the third-quarter increase in imports corresponds with a 8.4% year-over-year fall in inventory days, which may indicate that GameStop's supply chain is operating at a more efficient level, including an aggressive focus on cost-cutting.
Sherman also noted that the company "saw 257% growth in our e-commerce sales versus the prior year, reflecting investments during the year that enhanced our omnichannel capabilities." This trend is being seen throughout retail as noted in Panjiva's Dec. 7 research.
In the upcoming holiday season, Gamestop may be counting on increased sales from new Microsoft Corp. Xbox and Sony Corp. PlayStation consoles, along with anticipated new games like Cyberpunk 2077 driving additional interest in the new hardware. Panjiva's data shows the expansion in shipments of videogame consoles and peripherals seen earlier in the fall has likely continued in November.
U.S. seaborne imports linked to the Xbox surged 204.8% year over year, likely reflecting the influx of new consoles and peripherals. Shipments linked to Nintendo Co. Ltd. also improved 55.0%, perhaps reflecting restocking after shortages of the Switch platform earlier in the year. Sony, meanwhile, may be struggling with PlayStation shipments after a 1.1% decline. The company may need to rely on airfreight to ensure deliveries in time for the holidays.
Eric Oak is a researcher at Panjiva, which is a business line of S&P Global Market Intelligence, a division of S&P Global Inc. This content does not constitute investment advice, and the views and opinions expressed in this piece are those of the author and do not necessarily represent the views of S&P Global Market Intelligence. Links are current at the time of publication. S&P Global Market Intelligence is not responsible if those links are unavailable later.