Gamestop profits up sevenfold

US retail giant Gamestop has announced a 586 per cent year-on-year increase in net earnings for its second quarter – as sales soared by 38.9 per cent in the period.

For the quarter ended August 4th, the Texas-based retailer posted net income of $21.8 million, or 13 cents a share, which included debt-retirement costs of a penny per share.

The company posted profits of $3.18 million, or two cents a share, for the same period in 2006.

The news was revealed in the firm’s earnings call earlier today.

According to CNN, GameStop shares jumped by over six per cent to $46.07 following the call – a new record for stock that has nearly doubled in value since a two-for-one split took place in March.

Revenue grew 38.9 per cent to $1.34 billion from $963 million the previous year.

The biggest factor in the successful period was hardware – of where sales grew 87 per cent compared to 49 per cent growth for software sales.

GameStop Chairman and CEO Richard Fontaine said: "GameStop’s outstanding second quarter was fueled by continued consumer demand for all the prevalent hardware platforms and the compelling games released during the quarter.

It is apparent that the growing base of gaming consumers is well served by GameStop’s new and used model, our increasing number of convenient locations and outstanding customer service provided by our store ‘gamers’.”