With every quarter that passes, leading video game retailer GameStop posts monster financial numbers, but it doesn’t look like the company is about to slow down anytime soon.
"We believe GameStop continues to generate positive and steady ROI on new stores despite increasing penetration in North America and in some international markets. Moreover, the company expects to maintain the current pace of approximately 500 new store openings annually over the next 3-4 years, with capacity in the U.S. estimated to be 50% higher than current levels," said Lazard Capital Markets analyst Colin Sebastian in a note. "Internationally, we believe margins are improving as the used business gains traction and stores reach more mature levels in Australia and a number of European markets, including Italy, Germany, Scandinavia, Spain, Portugal, and Ireland."
While big box retailers like Best Buy are trying to get a piece of the video game pie as well, Sebastian said that GameStop continues to dominate, particularly with the hardcore demographic.
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