GameStop shares fall despite posting narrower loss and rising sales

GameStop shares fall despite posting narrower loss and rising sales

People walk by a GameStop store in Brooklyn on January 28, 2021 in New York City.

Spencer Platt | Getty Images News | Getty Images

Video game retailer GameStop reported Wednesday its second-quarter loss narrowed as sales rose from a a year ago.

The retailer also said that the U.S. Securities and Exchange Commission has requested additional documents for a probe into GameStop and other companies’ trading activity, which the retailer had disclosed in May.

GameStop said the inquiry is not expected to negatively impact the company.

Shares of the company fell more than 2% in extended trading. GameStop’s stock has been caught up in the so-called meme stock frenzy, with interest largely from retail investors pushing the value of its stock up 957% since the start of the year. GameStop’s market cap has swelled to $14.28 billion, but the company is still posting quarterly losses.

For the quarter ended July 31, the company reported a net loss of $61.6 million, or 85 cents per share, compared with a loss of $111.3 million, or $1.71 per share, a year ago. On an adjusted basis, GameStop lost 76 cents per share.

Sales rose to $1.18 billion from $942 million a year earlier.

According to Refinitiv, analysts were expecting the company to lose 67 cents a share on revenue of $1.12 billion.

GameStop has been trying to shift its business more toward e-commerce. In an effort to improve its delivery, the company announced it signed a lease for a 530,000-square-foot fulfillment center in Reno, Nevada. The site will help it to expand its fulfillment network across both U.S. coasts.

This is breaking news. Please check back for updates.