GameStop Corp. (GME) released its fiscal third-quarter results on Tuesday, December 9, 2025, revealing a mixed financial performance. While the company exceeded earnings per share (EPS) estimates, it fell short on revenue expectations, leading to a decline in its stock price during extended trading.
The video game retailer reported a net income of $77.1 million, or 13 cents per share, for the quarter. This compares favorably to the $17.4 million net income reported in the same quarter last year. Adjusted earnings, excluding certain non-recurring items, reached $0.24 per share, surpassing the consensus estimate of $0.20.
However, GameStop's revenue for the third quarter totaled $821 million, a 4.6% decrease compared to the $860.3 million reported in the prior year's third quarter. This also fell short of the $987.3 million forecast by Wall Street analysts. The company attributed the sales decline to softer demand in its core retail operations.
Despite the revenue miss, GameStop demonstrated improved cost management. Selling, general, and administrative expenses decreased significantly to $221.4 million, compared to $282.0 million in the same period last year. This reflects the management's focus on streamlining operations and reducing expenses.
The company's exposure to digital assets, particularly Bitcoin, remained substantial. At the end of the quarter, GameStop's Bitcoin holdings were valued at $519.4 million. While the company did not explicitly state the gains or losses from its digital asset holdings in the earnings release, fluctuations in cryptocurrency prices can significantly impact its financial results.
Adjusted operating income for the quarter was $52.1 million, compared to an adjusted operating loss of $24.6 million in the prior year's third quarter. This improvement reflects the company's efforts to improve profitability through cost reductions and strategic initiatives.
Looking ahead, analysts expect GameStop's earnings to grow by 125% in the next year, from $0.08 to $0.18 per share. This positive outlook suggests that the company's turnaround efforts may be gaining traction.
According to TipRanks' A.I. Stock Analysis, GME earns a "Neutral" rating with a price target of $23, implying a slight downside risk from current levels.
In conclusion, GameStop's third-quarter earnings presented a mixed bag for investors. While the company beat EPS estimates and demonstrated improved cost control, the revenue miss and the potential impact of fluctuating cryptocurrency prices remain concerns. GameStop's strategic initiatives and ability to adapt to the evolving gaming landscape will be crucial in determining its future performance.
