Gross Margin % is calculated as gross profit divided by its revenue. GameStop's Gross Profit for the
three
months ended in Jan. 2024 was $419 Mil. GameStop's Revenue for the
three
months ended in Jan. 2024 was $1,794 Mil. Therefore, GameStop's Gross Margin % for the quarter that ended in Jan. 2024 was 23.37%.
Warning Sign:
GameStop Corp gross margin has been in long-term decline. The average rate of decline per year is -4.1%.
The historical rank and industry rank for GameStop's Gross Margin % or its related term are showing as below:
GME'
s Gross Margin % Range Over the Past 10 Years
Min: 22.42 Med: 28.47 Max: 31.39
Current: 24.55
During the past 13 years, the highestGross Margin % of GameStop was 31.39%. The lowest was 22.42%. And the median was 28.47%.
GME's Gross Margin % is ranked worse than 72.37% of 1093
companies
in the Retail - Cyclical industry
Industry Median: 36.86
vs GME: 24.55
GameStop had a gross margin of 23.37% for the quarter that ended in Jan. 2024 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for GameStop was -4.10% per year.
GameStop Gross Margin % Historical Data
The historical data trend for GameStop's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
GameStop Annual Data
Trend
Jan15
Jan16
Jan17
Jan18
Jan19
Jan20
Jan21
Jan22
Jan23
Jan24
Gross Margin %
29.52
24.75
22.42
23.15
24.54
GameStop Quarterly Data
Apr19
Jul19
Oct19
Jan20
Apr20
Jul20
Oct20
Jan21
Apr21
Jul21
Oct21
Jan22
Apr22
Jul22
Oct22
Jan23
Apr23
Jul23
Oct23
Jan24
Gross Margin %
22.45
23.22
26.28
26.13
23.37
Competitive Comparison
For the Specialty Retail subindustry, GameStop's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
GameStop Gross Margin % Distribution
For the Retail - Cyclical industry and Consumer Cyclical sector, GameStop's Gross Margin % distribution charts can be found below:
* The bar in red indicates where GameStop's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
GameStop (NYSE:GME) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
GameStop had a gross margin of 23.37% for the quarter that ended in Jan. 2024 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
GameStop Gross Margin % Related Terms
Thank you for viewing the detailed overview of GameStop's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
GameStop Corp is a U.S. multichannel video game, consumer electronics, and services retailer. The company operates across Europe, Canada, Australia, and the United States. GameStop sells new and second-hand video game hardware, physical and digital video game software, and video game accessories, mainly through GameStop, EB Games, and Micromania stores and international e-commerce sites, including www.gamestop.com, www.ebgames.com.au, and www.micromania.fr. The company has two main business segments: Video game brands and Technology brands. The technology brands segment sells wireless products and services and operates Spring Mobile managed AT&T and Cricket Wireless branded stores, along with the Simply Mac business.
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