GME · Q2 FY2027
GameStop Corp. Q2 FY2027 earnings analysis
By SageNoodle ResearchBullish
| Metric | Actual | Estimate | Result |
|---|---|---|---|
| Revenue | $790.2M | $970.0M (yr ago) | Miss |
| EPS | $0.51 | $0.31 (yr ago) | Beat |
| Free Cash Flow | $60.0M | $110.0M (yr ago) | Miss |
| Gross Margin | 43.7% | 29.1% (yr ago) | Beat |
| Operating Margin | 20.3% | 6.8% (yr ago) | Beat |
What changed
Revenue fell 18.5% year over year to $790.2 million, but gross margin expanded 14.6 percentage points and operating margin expanded 13.5 points. EPS rose to $0.51 from $0.31, while free cash flow declined to approximately $60 million from $110 million.
Impact on the investment thesis
There was no prior SageNoodle fair value to revise, so we initiate fair value at $21.28 per share. The quarter strengthens the margin thesis, but declining revenue and weaker quarterly cash conversion keep the valuation close to the current price.