¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Commission File No. 1-32637
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Delaware
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20-2733559
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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625 Westport Parkway
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76051
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Grapevine, Texas
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(Zip Code)
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(Address of principal executive offices)
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(Title of Class)
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(Name of Exchange on Which Registered)
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Class A Common Stock, $.001 par value per share
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New York Stock Exchange
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Large Accelerated Filer
þ
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Accelerated Filer
¨
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Non-accelerated Filer
¨
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Smaller reporting company
¨
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Emerging growth company
¨
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 16.
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ITEM 1.
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BUSINESS
|
•
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New Video Game Hardware.
We offer video game platforms from the major manufacturers. The current generation of consoles include the Sony PlayStation 4 (2013), Microsoft Xbox One (2013) and the Nintendo Switch (March 2017). In 2016, Sony and Microsoft released refreshes to the PlayStation 4 and Xbox One, respectively. In November 2017, Microsoft released a further enhanced version of its current generation console, the Xbox One X. We also offer extended service agreements. Video game hardware sales are generally driven by the introduction of new platform technology and the reduction in price points as platforms mature.
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•
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New Video Game Software.
We offer new video game software for current and certain prior generation consoles from the leading manufacturers, including Sony, Nintendo and Microsoft, as well as all other major third-party game publishers, such as Electronic Arts and Activision Blizzard. We are one of the largest retailers of video game titles sold by these publishers. We carry new video game software across a variety of genres, including sports, action, strategy, adventure/role playing and simulation.
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•
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Pre-owned and Value Video Game Products.
We provide our customers with an opportunity to trade in their pre-owned video game products in our stores in exchange for store credits which can be applied towards the purchase of other products, primarily new merchandise. We believe this process drives our higher market share, particularly at launch. We resell these pre-owned video game products and have the largest selection of pre-owned video game titles. In the U.S., pre-owned video game software titles have an average price of $17, compared to an average price of $48 for new video game software titles, and generate significantly higher gross margins than new video game products. Our trade-in program also allows us to be one of the only suppliers of previous generation platforms and related video games. We also operate refurbishment centers in the United States, Canada, Australia and Europe, where defective video game products can be tested, repaired, relabeled, repackaged and redistributed back to our stores.
|
•
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Video Game Accessories.
Video game accessories consist primarily of controllers, gaming headsets, virtual reality products, memory cards and other add-ons for use with video game hardware and software.
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•
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Digital.
The proliferation of online game play through Microsoft Xbox Live, the PlayStation Network and PC gaming websites has led to consumer demand for subscription, time and points cards (“digital currency”) as well as full-game downloads and digitally downloadable content (“DLC”), for existing console video games. We sell a wide variety of digital currency, and we have developed technology to sell DLC and full-game downloads in our stores and on our U.S. website. We believe we are the worldwide leading retailer of digital currency and DLC for Xbox Live and the PlayStation Network.
|
•
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Collectibles
. Collectibles consist of licensed merchandise, primarily related to the video game, television and movie industries and pop culture themes which are sold through our video game stores, ThinkGeek stores, Zing Pop Culture stores and www.thinkgeek.com.
|
•
|
Other Products.
Other products primarily consist of PC entertainment software, gaming-related print media, mobile and consumer electronics, and revenues from PowerUp Pro loyalty members receiving Game Informer magazine in print form. We offer PC entertainment software from many of the largest PC publishers, including Electronic Arts, Take Two and Activision Blizzard across a variety of genres, including sports, action, strategy, adventure/role playing and simulation. We also carry strategy guides, magazines and interactive game figures, such as Amiibos from Nintendo.
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Number
of Stores
|
|
Canada
|
311
|
|
Total Stores - Canada Video Game Brands
|
311
|
|
|
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Australia
|
419
|
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New Zealand
|
43
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Total Stores - Australia Video Game Brands
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462
|
|
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Austria
|
25
|
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Denmark
|
34
|
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Finland
|
16
|
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France
|
420
|
|
Germany
|
208
|
|
Ireland
|
50
|
|
Italy
|
361
|
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Norway
|
28
|
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Sweden
|
52
|
|
Switzerland
|
17
|
|
Total Stores - Europe Video Game Brands
|
1,211
|
|
Total International Stores
|
1,984
|
|
Total Stores
|
5,830
|
|
ITEM 1A.
|
RISK FACTORS
|
•
|
economic downturns, specifically in the regions in which we operate;
|
•
|
currency exchange rate fluctuations;
|
•
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international incidents;
|
•
|
natural disasters;
|
•
|
government instability; and
|
•
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competitors entering our current and potential markets.
|
•
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the timing and allocations of new product releases including new console launches;
|
•
|
the timing of new store openings or closings;
|
•
|
shifts in the timing or content of certain promotions or service offerings;
|
•
|
the effect of changes in tax rates in the jurisdictions in which we operate;
|
•
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acquisition costs and the integration of companies we acquire or invest in;
|
•
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the mix of earnings in the countries in which we operate;
|
•
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the costs associated with the exit of unprofitable markets, businesses or stores; and
|
•
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changes in foreign currency exchange rates.
|
•
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incur, assume or permit to exist additional indebtedness or guaranty obligations;
|
•
|
incur liens or agree to negative pledges in other agreements;
|
•
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engage in sale and leaseback transactions;
|
•
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make loans and investments;
|
•
|
declare dividends, make payments or redeem or repurchase capital stock;
|
•
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engage in mergers, acquisitions and other business combinations;
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•
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prepay, redeem or purchase certain indebtedness;
|
•
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amend or otherwise alter the terms of our organizational documents and indebtedness;
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•
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sell assets; and
|
•
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engage in transactions with affiliates.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
Lease Terms to Expire During
(1)
|
|
Number
of Stores
|
|
Fiscal 2019
|
|
2,004
|
|
Fiscal 2020
|
|
1,040
|
|
Fiscal 2021
|
|
766
|
|
Fiscal 2022
|
|
646
|
|
Fiscal 2023 and later
|
|
1,374
|
|
Total
|
|
5,830
|
|
(1)
|
Our fiscal year is composed of the 52 or 53 weeks ending on the Saturday closest to January 31
st
.
|
Location
|
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Square
Footage
|
|
Owned or
Leased
|
|
Use
|
|
Grapevine, Texas, USA
|
|
519,000
|
|
|
Owned
|
|
Distribution and administration
|
Grapevine, Texas, USA
|
|
182,000
|
|
|
Owned
|
|
Manufacturing and distribution
|
Shepherdsville, Kentucky, USA
|
|
631,000
|
|
|
Leased
|
|
Distribution
|
Brampton, Ontario, Canada
|
|
119,000
|
|
|
Owned
|
|
Distribution and administration
|
Eagle Farm, Queensland, Australia
|
|
185,000
|
|
|
Owned
|
|
Distribution and administration
|
Milan, Italy
|
|
123,000
|
|
|
Owned
|
|
Distribution and administration
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
1/31/2014
|
|
1/30/2015
|
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1/29/2016
|
|
1/27/2017
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|
2/2/2018
|
|
2/1/2019
|
||||||||||||
GME
|
$
|
100.00
|
|
|
$
|
104.02
|
|
|
$
|
80.19
|
|
|
$
|
78.41
|
|
|
$
|
56.24
|
|
|
$
|
43.08
|
|
S&P 500 Index
|
$
|
100.00
|
|
|
$
|
114.21
|
|
|
$
|
113.44
|
|
|
$
|
137.11
|
|
|
$
|
168.40
|
|
|
$
|
168.30
|
|
Dow Jones Specialty Retailers Index
|
$
|
100.00
|
|
|
$
|
125.19
|
|
|
$
|
128.98
|
|
|
$
|
149.77
|
|
|
$
|
192.75
|
|
|
$
|
220.95
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
Fiscal Year
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(In millions, except statistical and per share data)
|
||||||||||||||||||
Statement of Operations Data:
(1)
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
8,285.3
|
|
|
$
|
8,547.1
|
|
|
$
|
7,965.0
|
|
|
$
|
9,018.9
|
|
|
$
|
9,084.0
|
|
Cost of sales
|
5,977.2
|
|
|
6,062.2
|
|
|
5,465.1
|
|
|
6,359.1
|
|
|
6,448.0
|
|
|||||
Gross profit
|
2,308.1
|
|
|
2,484.9
|
|
|
2,499.9
|
|
|
2,659.8
|
|
|
2,636.0
|
|
|||||
Selling, general and administrative expenses
|
1,888.6
|
|
|
1,909.6
|
|
|
1,861.9
|
|
|
1,905.5
|
|
|
1,906.6
|
|
|||||
Depreciation and amortization
|
105.6
|
|
|
122.3
|
|
|
136.7
|
|
|
141.0
|
|
|
149.6
|
|
|||||
Goodwill impairments
(2)
|
970.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Asset impairments
(3)
|
45.2
|
|
|
13.8
|
|
|
19.6
|
|
|
4.6
|
|
|
2.2
|
|
|||||
Operating (loss) earnings
|
(702.0
|
)
|
|
439.2
|
|
|
481.7
|
|
|
608.7
|
|
|
577.6
|
|
|||||
Interest expense, net
|
51.1
|
|
|
55.3
|
|
|
53.0
|
|
|
23.0
|
|
|
10.0
|
|
|||||
(Loss) earnings from continuing operations before income tax expense
|
(753.1
|
)
|
|
383.9
|
|
|
428.7
|
|
|
585.7
|
|
|
567.6
|
|
|||||
Income tax expense
|
41.7
|
|
|
153.5
|
|
|
124.2
|
|
|
206.5
|
|
|
198.5
|
|
|||||
Net (loss) income from continuing operations
|
(794.8
|
)
|
|
230.4
|
|
|
304.5
|
|
|
379.2
|
|
|
369.1
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
121.8
|
|
|
(195.7
|
)
|
|
48.7
|
|
|
23.6
|
|
|
24.0
|
|
|||||
Net (loss) income
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
|
$
|
402.8
|
|
|
$
|
393.1
|
|
Diluted Per Share Data:
(4)
|
|
|
|
|
|
|
|
|
|
||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(7.79
|
)
|
|
$
|
2.27
|
|
|
$
|
2.93
|
|
|
$
|
3.55
|
|
|
$
|
3.26
|
|
Earnings (loss) per share from discontinued operations
|
1.19
|
|
|
(1.93
|
)
|
|
0.47
|
|
|
0.22
|
|
|
0.21
|
|
|||||
Diluted (loss) earnings per share
|
$
|
(6.59
|
)
|
|
$
|
0.34
|
|
|
$
|
3.40
|
|
|
$
|
3.78
|
|
|
$
|
3.47
|
|
Dividends per common share
|
$
|
1.52
|
|
|
$
|
1.52
|
|
|
$
|
1.48
|
|
|
$
|
1.44
|
|
|
$
|
1.32
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
102.1
|
|
|
101.4
|
|
|
103.4
|
|
|
106.0
|
|
|
112.2
|
|
|||||
Diluted
|
102.1
|
|
|
101.5
|
|
|
103.8
|
|
|
106.7
|
|
|
113.2
|
|
|||||
Store Operating Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Comparable store sales (decrease) increase
(5)
|
(0.3
|
)%
|
|
5.8
|
%
|
|
(11.0
|
)%
|
|
4.3
|
%
|
|
3.4
|
%
|
|||||
Inventory turnover
|
4.5
|
|
|
5.0
|
|
|
4.7
|
|
|
5.3
|
|
|
5.2
|
|
|||||
Number of stores at fiscal year end
|
5,830
|
|
|
5,947
|
|
|
6,132
|
|
|
6,227
|
|
|
6,329
|
|
|||||
Balance Sheet Data at Fiscal Year End:
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
(6)
|
$
|
946.6
|
|
|
$
|
478.4
|
|
|
$
|
208.2
|
|
|
$
|
40.5
|
|
|
$
|
387.5
|
|
Total assets
|
$
|
4,044.3
|
|
|
$
|
5,041.6
|
|
|
$
|
4,975.9
|
|
|
$
|
4,330.3
|
|
|
$
|
4,240.4
|
|
Total debt, net
(7)
|
$
|
820.8
|
|
|
$
|
817.9
|
|
|
$
|
815.0
|
|
|
$
|
345.4
|
|
|
$
|
344.7
|
|
Total liabilities
|
$
|
2,708.1
|
|
|
$
|
2,827.1
|
|
|
$
|
2,721.8
|
|
|
$
|
2,249.3
|
|
|
$
|
2,172.7
|
|
Total stockholders' equity
|
$
|
1,336.2
|
|
|
$
|
2,214.5
|
|
|
$
|
2,254.1
|
|
|
$
|
2,081.0
|
|
|
$
|
2,067.7
|
|
(1)
|
We completed the previously announced sale of our Spring Mobile business in January 2019. The historical results of Spring Mobile, including the gain on sale, are reported as discontinued operations for all periods presented.
|
(2)
|
In fiscal 2018, we recognized goodwill impairment charges totaling
$795.6 million
,
$28.8 million
,
$66.4 million
and
$79.9 million
for the United States, Canada, Australia and Europe segments, respectively. See Note 7, "Goodwill and Intangible Assets," to our consolidated financial statements for additional information.
|
(3)
|
Asset impairment charges primarily relate to intangible assets and store-level property and equipment. We recognized intangible asset impairment charges totaling
$43.1 million
, $11.0 million and $14.4 million in fiscal 2018, 2017 and 2016. See Note 7, "Goodwill and Intangible Assets," to our consolidated financial statements for additional information.
|
(4)
|
The sum of (loss) earnings per share for continuing operations and discontinued operations may not necessarily total to consolidated (loss) earnings per share as amounts are calculated based on whole numbers.
|
(5)
|
Comparable store sales is a measure commonly used in the retail industry and indicates store performance by measuring the growth in sales for certain stores for a particular period over the corresponding period in the prior year. Our comparable store sales are comprised of sales from our video game brands stores, including stand-alone collectible stores, operating for at least 12 full months as well as sales related to our websites and sales we earn from sales of pre-owned merchandise to wholesalers or dealers. Comparable store sales for our international operating segments exclude the effect of changes in foreign currency exchange rates. The calculation of comparable store sales compares the fiscal year ended to the most closely comparable weeks for the prior year period. The method of calculating comparable store sales varies across the retail industry. As a result, our method of calculating comparable store sales may not be the same as other retailers’ methods. We believe our calculation of comparable store sales best represents our strategy as an omnichannel retailer who provides its consumers several ways to access its products.
|
(6)
|
Net working capital excludes held-for-sale assets and liabilities related to our Spring Mobile business, which was sold in January 2019.
|
(7)
|
In March 2016, we issued $475 million aggregate principal of 6.75% unsecured senior notes due in March 2021. In September 2014, we issued $350.0 million aggregate principal of 5.50% unsecured senior notes due in October 2019. On March 4, 2019, we issued a notice of redemption to redeem all of our 2019 Senior Notes on April 4, 2019. See Note 10, "Debt," to our consolidated financial statements for additional information.
|
ITEM 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
February 3, 2018
|
|
Opened/Acquired
|
|
Disposed
|
|
February 2, 2019
|
||||
Video Game Stores
|
5,796
|
|
|
24
|
|
|
(136
|
)
|
|
5,684
|
|
Collectibles Stores
|
103
|
|
|
4
|
|
|
(4
|
)
|
|
103
|
|
Simply Mac
|
48
|
|
|
—
|
|
|
(5
|
)
|
|
43
|
|
Total Stores
|
5,947
|
|
|
28
|
|
|
(145
|
)
|
|
5,830
|
|
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
|||||||||||||||
|
|
Amount
|
|
Percent of Net Sales
|
|
Amount
|
|
Percent of Net Sales
|
|
Amount
|
|
Percent of Net Sales
|
|||||||||
Net sales
|
|
$
|
8,285.3
|
|
|
100.0
|
%
|
|
$
|
8,547.1
|
|
|
100.0
|
%
|
|
$
|
7,965.0
|
|
|
100.0
|
%
|
Cost of sales
|
|
5,977.2
|
|
|
72.1
|
|
|
6,062.2
|
|
|
70.9
|
|
|
5,465.1
|
|
|
68.6
|
|
|||
Gross profit
|
|
2,308.1
|
|
|
27.9
|
|
|
2,484.9
|
|
|
29.1
|
|
|
2,499.9
|
|
|
31.4
|
|
|||
Selling, general and administrative expenses
|
|
1,888.6
|
|
|
22.9
|
|
|
1,909.6
|
|
|
22.4
|
|
|
1,861.9
|
|
|
23.4
|
|
|||
Depreciation and amortization
|
|
105.6
|
|
|
1.3
|
|
|
122.3
|
|
|
1.4
|
|
|
136.7
|
|
|
1.7
|
|
|||
Goodwill impairments
|
|
970.7
|
|
|
11.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Asset impairments
|
|
45.2
|
|
|
0.5
|
|
|
13.8
|
|
|
0.2
|
|
|
19.6
|
|
|
0.2
|
|
|||
Operating (loss) earnings
|
|
(702.0
|
)
|
|
(8.5
|
)
|
|
439.2
|
|
|
5.1
|
|
|
481.7
|
|
|
6.1
|
|
|||
Interest expense, net
|
|
51.1
|
|
|
0.6
|
|
|
55.3
|
|
|
0.6
|
|
|
53.0
|
|
|
0.7
|
|
|||
(Loss) earnings from continuing operations before income taxes
|
|
(753.1
|
)
|
|
(9.1
|
)
|
|
383.9
|
|
|
4.5
|
|
|
428.7
|
|
|
5.4
|
|
|||
Income tax expense
|
|
41.7
|
|
|
0.5
|
|
|
153.5
|
|
|
1.8
|
|
|
124.2
|
|
|
1.6
|
|
|||
Net (loss) income from continuing operations
|
|
(794.8
|
)
|
|
(9.6
|
)
|
|
230.4
|
|
|
2.7
|
|
|
304.5
|
|
|
3.8
|
|
|||
Income (loss) from discontinued operations, net of tax
|
|
121.8
|
|
|
1.5
|
|
|
(195.7
|
)
|
|
(2.3
|
)
|
|
48.7
|
|
|
0.6
|
|
|||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
(8.1
|
)%
|
|
$
|
34.7
|
|
|
0.4
|
%
|
|
$
|
353.2
|
|
|
4.4
|
%
|
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
|||||||||||||||
|
|
Net Sales
|
|
Percent of Net Sales
|
|
Net Sales
|
|
Percent of Net Sales
|
|
Net Sales
|
|
Percent of Net Sales
|
|||||||||
New video game hardware
(1)
|
|
$
|
1,767.8
|
|
|
21.3
|
%
|
|
$
|
1,791.8
|
|
|
21.0
|
%
|
|
$
|
1,396.7
|
|
|
17.5
|
%
|
New video game software
|
|
2,449.7
|
|
|
29.6
|
|
|
2,582.0
|
|
|
30.2
|
|
|
2,493.4
|
|
|
31.3
|
|
|||
Pre-owned and value video game products
|
|
1,866.3
|
|
|
22.5
|
|
|
2,149.6
|
|
|
25.2
|
|
|
2,254.1
|
|
|
28.3
|
|
|||
Video game accessories
|
|
956.5
|
|
|
11.5
|
|
|
784.3
|
|
|
9.2
|
|
|
676.7
|
|
|
8.5
|
|
|||
Digital
|
|
194.0
|
|
|
2.3
|
|
|
189.2
|
|
|
2.2
|
|
|
181.0
|
|
|
2.3
|
|
|||
Collectibles
|
|
707.5
|
|
|
8.5
|
|
|
636.2
|
|
|
7.4
|
|
|
494.1
|
|
|
6.2
|
|
|||
Other
(2)
|
|
343.5
|
|
|
4.3
|
|
|
414.0
|
|
|
4.8
|
|
|
469.0
|
|
|
5.9
|
|
|||
Total
|
|
$
|
8,285.3
|
|
|
100.0
|
%
|
|
$
|
8,547.1
|
|
|
100.0
|
%
|
|
$
|
7,965.0
|
|
|
100.0
|
%
|
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
|||||||||||||||
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|||||||||
New video game hardware
(1)
|
|
$
|
150.0
|
|
|
8.5
|
%
|
|
$
|
163.1
|
|
|
9.1
|
%
|
|
$
|
154.2
|
|
|
11.0
|
%
|
New video game software
|
|
525.6
|
|
|
21.5
|
|
|
590.3
|
|
|
22.9
|
|
|
600.4
|
|
|
24.1
|
|
|||
Pre-owned and value video game products
|
|
810.4
|
|
|
43.4
|
|
|
977.1
|
|
|
45.5
|
|
|
1,044.1
|
|
|
46.3
|
|
|||
Video game accessories
|
|
312.5
|
|
|
32.7
|
|
|
255.0
|
|
|
32.5
|
|
|
235.2
|
|
|
34.8
|
|
|||
Digital
|
|
171.6
|
|
|
88.5
|
|
|
162.4
|
|
|
85.8
|
|
|
155.5
|
|
|
85.9
|
|
|||
Collectibles
|
|
233.3
|
|
|
33.0
|
|
|
208.2
|
|
|
32.7
|
|
|
171.6
|
|
|
34.7
|
|
|||
Other
(2)
|
|
104.7
|
|
|
30.5
|
|
|
128.8
|
|
|
31.1
|
|
|
138.9
|
|
|
29.6
|
|
|||
Total
|
|
$
|
2,308.1
|
|
|
27.9
|
%
|
|
$
|
2,484.9
|
|
|
29.1
|
%
|
|
$
|
2,499.9
|
|
|
31.4
|
%
|
(1)
|
Includes sales of hardware bundles, in which physical hardware and digital or physical software are sold together as a single SKU.
|
(2)
|
Includes the operations of our Simply Mac stores and Cricket Wireless branded stores. We sold our Cricket Wireless branded stores in January 2018. Also includes sales of PC entertainment software, interactive game figures, strategy guides, mobile and consumer electronics sold through our video game brands, and revenues from PowerUp Pro loyalty members receiving Game Informer magazine in print form.
|
|
|
Fiscal Year
|
|
Change
|
|||||||||||
|
|
2018
|
|
2017
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
Net sales
|
|
$
|
8,285.3
|
|
|
$
|
8,547.1
|
|
|
$
|
(261.8
|
)
|
|
(3.1
|
)%
|
Cost of sales
|
|
5,977.2
|
|
|
6,062.2
|
|
|
(85.0
|
)
|
|
(1.4
|
)
|
|||
Gross profit
|
|
2,308.1
|
|
|
2,484.9
|
|
|
(176.8
|
)
|
|
(7.1
|
)
|
|||
Selling, general and administrative expenses
|
|
1,888.6
|
|
|
1,909.6
|
|
|
(21.0
|
)
|
|
(1.1
|
)
|
|||
Depreciation and amortization
|
|
105.6
|
|
|
122.3
|
|
|
(16.7
|
)
|
|
(13.7
|
)
|
|||
Goodwill impairments
|
|
970.7
|
|
|
—
|
|
|
970.7
|
|
|
—
|
|
|||
Asset impairments
|
|
45.2
|
|
|
13.8
|
|
|
31.4
|
|
|
227.5
|
|
|||
Operating (loss) earnings
|
|
(702.0
|
)
|
|
439.2
|
|
|
(1,141.2
|
)
|
|
(259.8
|
)
|
|||
Interest expense, net
|
|
51.1
|
|
|
55.3
|
|
|
(4.2
|
)
|
|
(7.6
|
)
|
|||
(Loss) earnings from continuing operations before income taxes
|
|
(753.1
|
)
|
|
383.9
|
|
|
(1,137.0
|
)
|
|
(296.2
|
)
|
|||
Income tax expense
|
|
41.7
|
|
|
153.5
|
|
|
(111.8
|
)
|
|
(72.8
|
)
|
|||
Net (loss) income from continuing operations
|
|
(794.8
|
)
|
|
230.4
|
|
|
(1,025.2
|
)
|
|
(445.0
|
)%
|
|||
Income (loss) from discontinued operations, net of tax
|
|
121.8
|
|
|
(195.7
|
)
|
|
317.5
|
|
|
(162.2
|
)%
|
|||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
(707.7
|
)
|
|
(2,039.5
|
)%
|
|
|
Net Sales
|
|
Change
|
|||||||||||
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
New video game hardware
(1)
|
|
$
|
1,767.8
|
|
|
$
|
1,791.8
|
|
|
$
|
(24.0
|
)
|
|
(1.3
|
)%
|
New video game software
|
|
2,449.7
|
|
|
2,582.0
|
|
|
(132.3
|
)
|
|
(5.1
|
)
|
|||
Pre-owned and value video game products
|
|
1,866.3
|
|
|
2,149.6
|
|
|
(283.3
|
)
|
|
(13.2
|
)
|
|||
Video game accessories
|
|
956.5
|
|
|
784.3
|
|
|
172.2
|
|
|
22.0
|
|
|||
Digital
|
|
194.0
|
|
|
189.2
|
|
|
4.8
|
|
|
2.5
|
|
|||
Collectibles
|
|
707.5
|
|
|
636.2
|
|
|
71.3
|
|
|
11.2
|
|
|||
Other
(2)
|
|
343.5
|
|
|
414.0
|
|
|
(70.5
|
)
|
|
(17.0
|
)
|
|||
Total
|
|
$
|
8,285.3
|
|
|
$
|
8,547.1
|
|
|
$
|
(261.8
|
)
|
|
(3.1
|
)%
|
|
|
Gross Profit
|
|
Change
|
|||||||||||
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
New video game hardware
(1)
|
|
$
|
150.0
|
|
|
$
|
163.1
|
|
|
$
|
(13.1
|
)
|
|
(8.0
|
)%
|
New video game software
|
|
525.6
|
|
|
590.3
|
|
|
(64.7
|
)
|
|
(11.0
|
)
|
|||
Pre-owned and value video game products
|
|
810.4
|
|
|
977.1
|
|
|
(166.7
|
)
|
|
(17.1
|
)
|
|||
Video game accessories
|
|
312.5
|
|
|
255.0
|
|
|
57.5
|
|
|
22.5
|
|
|||
Digital
|
|
171.6
|
|
|
162.4
|
|
|
9.2
|
|
|
5.7
|
|
|||
Collectibles
|
|
233.3
|
|
|
208.2
|
|
|
25.1
|
|
|
12.1
|
|
|||
Other
(2)
|
|
104.7
|
|
|
128.8
|
|
|
(24.1
|
)
|
|
(18.7
|
)
|
|||
Total
|
|
$
|
2,308.1
|
|
|
$
|
2,484.9
|
|
|
$
|
(176.8
|
)
|
|
(7.1
|
)%
|
(1)
|
Includes sales of hardware bundles, in which physical hardware and digital or physical software are sold together as a single SKU.
|
(2)
|
Includes the operations of our Simply Mac stores and Cricket Wireless branded stores. We sold our Cricket Wireless branded stores in January 2018. Also includes sales of PC entertainment software, interactive game figures, strategy guides, mobile and consumer electronics sold through our video game brands, and revenues from PowerUp Pro loyalty members receiving Game Informer magazine in print form.
|
•
|
Pre-owned and value video game product sales decreased
$283.3 million
, or
13.2%
, for fiscal 2018 as compared to fiscal 2017. Pre-owned and value video game product sales for the 53
rd
week included in fiscal 2017 were approximately $37.7 million. The decrease in fiscal 2018 compared to fiscal 2017 was primarily due to a decline in pre-owned software, partially offset by an increase in sales of pre-owned hardware. The decline in pre-owned software sales is primarily due to fewer new title releases and a decline in new video game software sales in the first six months of fiscal 2018, which affects pre-owned inventory levels, weakening demand as a result of increasing digital adoption, including digital access to older titles, and lower promotional activity in fiscal 2018.
|
•
|
New video game software sales decreased
$132.3 million
, or
5.1%
, for fiscal 2018 as compared to fiscal 2017. New video game software sales for the 53
rd
week included in fiscal 2017 were approximately $36.4 million. The decline was primarily due to weaker new title releases in the first six months of fiscal 2018, which was partially offset by an increase in sales of Nintendo Switch titles due to the expansion of the hardware install base and the increase of new release titles.
|
•
|
Video game accessories increased
$172.2 million
, or
22.0%
, for fiscal 2018 as compared to fiscal 2017, due to growth in sales of audio-related and other accessories primarily associated with the battle royale gaming genre.
|
•
|
Collectibles sales increased
$71.3 million
, or
11.2%
, for fiscal 2018 as compared to fiscal 2017, primarily driven by new and improved product offerings.
|
•
|
Pre-owned and value video game products decreased to
43.4%
in fiscal 2018 from
45.5%
in fiscal 2017 due to a greater mix of sales of pre-owned hardware, which carry lower gross margin than pre-owned software.
|
•
|
New video game software decreased to
21.5%
in fiscal 2018 from
22.9%
in fiscal 2017, primarily due to higher promotional activity in the fiscal 2018 holiday season.
|
|
|
Fiscal Year
|
|
Change
|
|||||||||||
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
Net sales
|
|
$
|
8,547.1
|
|
|
$
|
7,965.0
|
|
|
$
|
582.1
|
|
|
7.3
|
%
|
Cost of sales
|
|
6,062.2
|
|
|
5,465.1
|
|
|
597.1
|
|
|
10.9
|
|
|||
Gross profit
|
|
2,484.9
|
|
|
2,499.9
|
|
|
(15.0
|
)
|
|
(0.6
|
)
|
|||
Selling, general and administrative expenses
|
|
1,909.6
|
|
|
1,861.9
|
|
|
47.7
|
|
|
2.6
|
|
|||
Depreciation and amortization
|
|
122.3
|
|
|
136.7
|
|
|
(14.4
|
)
|
|
(10.5
|
)
|
|||
Asset impairments
|
|
13.8
|
|
|
19.6
|
|
|
(5.8
|
)
|
|
(29.6
|
)
|
|||
Operating earnings
|
|
439.2
|
|
|
481.7
|
|
|
(42.5
|
)
|
|
(8.8
|
)
|
|||
Interest expense, net
|
|
55.3
|
|
|
53.0
|
|
|
2.3
|
|
|
4.3
|
|
|||
Earnings from continuing operations before income taxes
|
|
383.9
|
|
|
428.7
|
|
|
(44.8
|
)
|
|
(10.5
|
)
|
|||
Income tax expense
|
|
153.5
|
|
|
124.2
|
|
|
29.3
|
|
|
23.6
|
|
|||
Net income from continuing operations
|
|
230.4
|
|
|
304.5
|
|
|
(74.1
|
)
|
|
(24.3
|
)
|
|||
(Loss) income from discontinued operations, net of tax
|
|
(195.7
|
)
|
|
48.7
|
|
|
(244.4
|
)
|
|
(501.8
|
)
|
|||
Net income
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
|
$
|
(318.5
|
)
|
|
(90.2
|
)%
|
|
|
Net Sales
|
|
Change
|
|||||||||||
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
New video game hardware
(1)
|
|
$
|
1,791.8
|
|
|
$
|
1,396.7
|
|
|
$
|
395.1
|
|
|
28.3
|
%
|
New video game software
|
|
2,582.0
|
|
|
2,493.4
|
|
|
88.6
|
|
|
3.6
|
|
|||
Pre-owned and value video game products
|
|
2,149.6
|
|
|
2,254.1
|
|
|
(104.5
|
)
|
|
(4.6
|
)
|
|||
Video game accessories
|
|
784.3
|
|
|
676.7
|
|
|
107.6
|
|
|
15.9
|
|
|||
Digital
|
|
189.2
|
|
|
181.0
|
|
|
8.2
|
|
|
4.5
|
|
|||
Collectibles
|
|
636.2
|
|
|
494.1
|
|
|
142.1
|
|
|
28.8
|
|
|||
Other
(2)
|
|
414.0
|
|
|
469.0
|
|
|
(55.0
|
)
|
|
(11.7
|
)
|
|||
Total
|
|
$
|
8,547.1
|
|
|
$
|
7,965.0
|
|
|
$
|
582.1
|
|
|
7.3
|
%
|
|
|
Gross Profit
|
|
Change
|
|||||||||||
|
|
Fiscal Year 2017
|
|
Fiscal Year 2016
|
|
$
|
|
%
|
|||||||
|
|
($ in millions)
|
|
|
|
|
|||||||||
New video game hardware
(1)
|
|
$
|
163.1
|
|
|
$
|
154.2
|
|
|
$
|
8.9
|
|
|
5.8
|
%
|
New video game software
|
|
590.3
|
|
|
600.4
|
|
|
(10.1
|
)
|
|
(1.7
|
)
|
|||
Pre-owned and value video game products
|
|
977.1
|
|
|
1,044.1
|
|
|
(67.0
|
)
|
|
(6.4
|
)
|
|||
Video game accessories
|
|
255.0
|
|
|
235.2
|
|
|
19.8
|
|
|
8.4
|
|
|||
Digital
|
|
162.4
|
|
|
155.5
|
|
|
6.9
|
|
|
4.4
|
|
|||
Collectibles
|
|
208.2
|
|
|
171.6
|
|
|
36.6
|
|
|
21.3
|
|
|||
Other
(2)
|
|
128.8
|
|
|
138.9
|
|
|
(10.1
|
)
|
|
(7.3
|
)
|
|||
Total
|
|
$
|
2,484.9
|
|
|
$
|
2,499.9
|
|
|
$
|
(15.0
|
)
|
|
(0.6
|
)%
|
(1)
|
Includes sales of hardware bundles, in which physical hardware and digital or physical software are sold together as a single SKU.
|
(2)
|
Includes the operations of our Simply Mac stores and Cricket Wireless branded stores. We sold our Cricket Wireless branded stores in January 2018. Also includes sales of PC entertainment software, interactive game figures, strategy guides, mobile and consumer electronics sold through our video game brands, and revenues from PowerUp Pro loyalty members receiving Game Informer magazine in print form.
|
•
|
New video game hardware sales increased $395.1 million, or 28.3%, for fiscal 2017 as compared to fiscal 2016, primarily due to the launch of the Nintendo Switch in March 2017, which was partially offset by decreases in sales of other consoles as their cycles mature.
|
•
|
Collectibles sales increased $142.1 million, or 28.8%, for fiscal 2017 as compared to fiscal 2016, due to the growth of collectibles sales in our Video Game Brands stores and the growth in the number of stand-alone collectibles stores.
|
•
|
Video game accessories increased $107.6 million, or 15.9%, for fiscal 2017 as compared to fiscal 2016, primarily due to the recent release of the Nintendo Switch.
|
•
|
New video game software sales increased $88.6 million, or 3.6%, for fiscal 2017 as compared to fiscal 2016, primarily due to the recent release of the Nintendo Switch.
|
•
|
New video game hardware decreased to 9.1% in fiscal 2017 from 11.0% in fiscal 2016, primarily due to product mix shift in console sales.
|
•
|
New video game software decreased to 22.9% in fiscal 2017 from 24.1% in fiscal 2016, primarily due to lower cooperative advertising funds as a percentage of sales combined with higher promotional activity in the fiscal 2017 holiday season.
|
•
|
Pre-owned and value video game products decreased to 45.5% in fiscal 2017 from 46.3% in fiscal 2016 due to a greater mix of sales of current generation products, which carry lower gross margin than previous generation products.
|
•
|
Video game accessories decreased to 32.5% in fiscal 2017 from 34.8% in fiscal 2016, due to a shift in product mix including PlayStation VR which carry lower margin.
|
•
|
Collectibles decreased to 32.7% in fiscal 2017 from 34.7% in fiscal 2016, primarily due to increased promotional activity in the fiscal 2017 holiday season.
|
As of and for the Fiscal Year Ended February 2, 2019
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
5,800.2
|
|
|
$
|
434.5
|
|
|
$
|
645.4
|
|
|
$
|
1,405.2
|
|
|
$
|
8,285.3
|
|
Goodwill impairments
|
$
|
795.6
|
|
|
$
|
28.8
|
|
|
$
|
66.4
|
|
|
$
|
79.9
|
|
|
$
|
970.7
|
|
Operating loss
|
$
|
(533.9
|
)
|
|
$
|
(19.3
|
)
|
|
$
|
(46.5
|
)
|
|
$
|
(102.3
|
)
|
|
$
|
(702.0
|
)
|
Segment Operating data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Store count
|
3,846
|
|
|
311
|
|
|
462
|
|
|
1,211
|
|
|
5,830
|
|
|||||
Comparable store sales
|
1.8
|
%
|
|
3.1
|
%
|
|
(3.4
|
)%
|
|
(7.7
|
)%
|
|
(0.3
|
)%
|
As of and for the Fiscal Year Ended February 3, 2018
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
5,876.0
|
|
|
$
|
434.9
|
|
|
$
|
702.2
|
|
|
$
|
1,534.0
|
|
|
$
|
8,547.1
|
|
Operating earnings
|
$
|
332.8
|
|
|
$
|
18.5
|
|
|
$
|
34.9
|
|
|
$
|
53.0
|
|
|
$
|
439.2
|
|
Segment Operating data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Store count
|
3,912
|
|
|
321
|
|
|
467
|
|
|
1,247
|
|
|
5,947
|
|
|||||
Comparable store sales
|
4.3
|
%
|
|
10.0
|
%
|
|
8.2
|
%
|
|
9.5
|
%
|
|
5.8
|
%
|
As of and for the Fiscal Year Ended January 28, 2017
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
5,660.0
|
|
|
$
|
382.0
|
|
|
$
|
609.5
|
|
|
$
|
1,313.5
|
|
|
$
|
7,965.0
|
|
Operating earnings
|
$
|
398.4
|
|
|
$
|
22.4
|
|
|
$
|
34.9
|
|
|
$
|
26.0
|
|
|
$
|
481.7
|
|
Segment Operating data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Store count
|
4,063
|
|
|
322
|
|
|
464
|
|
|
1,283
|
|
|
6,132
|
|
|||||
Comparable store sales
|
(13.5
|
)%
|
|
(12.6
|
)%
|
|
(2.0
|
)%
|
|
(2.7
|
)%
|
|
(11.0
|
)%
|
•
|
On January 16, 2019, we completed the sale of Spring Mobile for cash proceeds of $727.9 million, net of transaction costs and preliminary adjustments;
|
•
|
On March 4, 2019, we announced that our Board of Directors approved a new $300.0 million share repurchase authorization to replace the previous share repurchase authorization, which had $170.2 million remaining; and
|
•
|
We issued a notice of redemption to redeem all of our $350.0 million unsecured senior notes due October 2019. The redemption date will be April 4, 2019, and we expect to use cash on hand.
|
|
|
Fiscal Year 2016
|
||
Total number of shares purchased
|
|
3.0
|
|
|
Average price per share
|
|
$
|
24.94
|
|
Aggregate value of shares purchased
|
|
$
|
75.1
|
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
|
Total
|
|
Less Than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than
5 Years
|
||||||||||
Operating leases
|
|
$
|
947.0
|
|
|
$
|
296.2
|
|
|
$
|
357.8
|
|
|
$
|
176.8
|
|
|
$
|
116.2
|
|
Purchase obligations
(1)
|
|
595.8
|
|
|
595.7
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|||||
2019 Senior Notes
|
|
350.0
|
|
|
350.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
2021 Senior Notes
|
|
475.0
|
|
|
—
|
|
|
475.0
|
|
|
—
|
|
|
—
|
|
|||||
Interest payments on senior notes
|
|
99.4
|
|
|
51.3
|
|
|
48.1
|
|
|
—
|
|
|
—
|
|
|||||
Total
(2)
|
|
$
|
2,467.2
|
|
|
$
|
1,293.2
|
|
|
$
|
881.0
|
|
|
$
|
176.8
|
|
|
$
|
116.2
|
|
(1)
|
Purchase obligations represent outstanding purchase orders for merchandise from vendors. These purchase orders are generally cancelable until shipment of the products.
|
(2)
|
As of
February 2, 2019
, we had
$17.7 million
of income tax liability related to unrecognized tax benefits in other long-term liabilities in our consolidated balance sheet. At the time of this filing, the settlement period for the noncurrent portion of our income tax liability (and the timing of any related payments) cannot be reasonably determined and therefore these liabilities are excluded from the table above. In addition, certain payments related to unrecognized tax benefits would be partially offset by reductions in payments in other jurisdictions. See Note 8, "Income Taxes," to our consolidated financial statements for further information regarding our uncertain tax positions.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
/s/ DELOITTE & TOUCHE LLP
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE*
|
ITEM 11.
|
EXECUTIVE COMPENSATION*
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS*
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE*
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES*
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULE
|
(a)
|
The following documents are filed as a part of this Form 10-K:
|
(1)
|
Index and Consolidated Financial Statements
|
(2)
|
Financial Statement Schedules required to be filed by Item 8 of this Form 10-K:
|
(b)
|
Exhibits
|
|
|
Balance at
Beginning
of Period
|
|
Charged to
Costs and
Expenses
|
|
Charged
to Other
Accounts-
Accounts
Payable
(1)
|
|
Deductions-
Write-Offs
Net of
Recoveries
(2)
|
|
Balance at
End of
Period
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Inventory Reserve
(3)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
52 Weeks Ended February 2, 2019
|
|
$
|
59.2
|
|
|
$
|
50.1
|
|
|
$
|
46.7
|
|
|
$
|
(86.6
|
)
|
|
$
|
69.4
|
|
53 Weeks Ended February 3, 2018
|
|
$
|
59.0
|
|
|
$
|
57.3
|
|
|
$
|
50.7
|
|
|
$
|
(107.8
|
)
|
|
$
|
59.2
|
|
52 Weeks Ended January 28, 2017
|
|
$
|
61.5
|
|
|
$
|
47.5
|
|
|
$
|
49.6
|
|
|
$
|
(99.6
|
)
|
|
$
|
59.0
|
|
Valuation Allowance for Deferred Tax Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
52 Weeks Ended February 2, 2019
|
|
$
|
36.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(4.0
|
)
|
|
$
|
32.9
|
|
53 Weeks Ended February 3, 2018
|
|
$
|
39.4
|
|
|
$
|
3.6
|
|
|
$
|
—
|
|
|
$
|
(6.1
|
)
|
|
$
|
36.9
|
|
52 Weeks Ended January 28, 2017
|
|
$
|
18.8
|
|
|
$
|
20.9
|
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
$
|
39.4
|
|
(1)
|
Consists primarily of amounts received from vendors for defective allowances.
|
(2)
|
The
52 weeks ended February 2, 2019
includes the disposition of
$3.6 million
of Spring Mobile inventory reserves as of the date of the sale.
|
(3)
|
Includes inventory reserve activity related to Spring Mobile. Spring Mobile was sold in January 2019.
|
ITEM 16.
|
FORM 10-K SUMMARY
|
|
GAMESTOP CORP.
|
|
|
|
|
|
By:
|
/s/ SHANE S. KIM
|
|
|
Shane S. Kim
|
|
|
Interim Chief Executive Officer and Director
|
Name
|
|
Capacity
|
|
Date
|
|
|
|
||
/s/ SHANE S. KIM
|
|
Interim Chief Executive Officer and Director
|
|
April 2, 2019
|
Shane S. Kim
|
|
(Principal Executive Officer)
|
|
|
|
|
|
||
/s/ DANIEL A. DEMATTEO
|
|
Executive Chairman and Director
|
|
April 2, 2019
|
Daniel A. DeMatteo
|
|
|
|
|
|
|
|
||
/s/ ROBERT A. LLOYD
|
|
Chief Operating Officer and Chief Financial Officer
|
|
April 2, 2019
|
Robert A. Lloyd
|
|
(Principal Financial Officer)
|
|
|
|
|
|
||
/s/ TROY W. CRAWFORD
|
|
Senior Vice President, Chief Accounting Officer
|
|
April 2, 2019
|
Troy W. Crawford
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
||
/s/ JEROME L. DAVIS
|
|
Director
|
|
April 2, 2019
|
Jerome L. Davis
|
|
|
|
|
|
|
|
||
/s/ THOMAS N. KELLY JR.
|
|
Director
|
|
April 2, 2019
|
Thomas N. Kelly Jr.
|
|
|
|
|
|
|
|
|
|
/s/ STEVEN R. KOONIN
|
|
Director
|
|
April 2, 2019
|
Steven R. Koonin
|
|
|
|
|
|
|
|
||
/s/ CARRIE W. TEFFNER
|
|
Director
|
|
April 2, 2019
|
Carrie W. Teffner
|
|
|
|
|
|
|
|
||
/s/ GERALD R. SZCZEPANSKI
|
|
Director
|
|
April 2, 2019
|
Gerald R. Szczepanski
|
|
|
|
|
|
|
|
||
/s/ KATHY P. VRABECK
|
|
Director
|
|
April 2, 2019
|
Kathy P. Vrabeck
|
|
|
|
|
|
|
|
|
|
/s/ LAWRENCE S. ZILAVY
|
|
Director
|
|
April 2, 2019
|
Lawrence S. Zilavy
|
|
|
|
|
|
Page
|
GameStop Corp. Consolidated Financial Statements:
|
|
Consolidated Financial Statements:
|
|
Notes to Consolidated Financial Statements:
|
|
/s/ DELOITTE & TOUCHE LLP
|
|
|
February 2,
2019 |
|
February 3,
2018 |
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,624.4
|
|
|
$
|
854.2
|
|
Receivables, net
|
|
134.2
|
|
|
138.6
|
|
||
Merchandise inventories, net
|
|
1,250.5
|
|
|
1,250.3
|
|
||
Prepaid expenses and other current assets
|
|
118.6
|
|
|
115.2
|
|
||
Assets held for sale
|
|
—
|
|
|
660.1
|
|
||
Total current assets
|
|
3,127.7
|
|
|
3,018.4
|
|
||
Property and equipment:
|
|
|
|
|
||||
Land
|
|
18.7
|
|
|
19.9
|
|
||
Buildings and leasehold improvements
|
|
638.2
|
|
|
651.8
|
|
||
Fixtures and equipment
|
|
900.2
|
|
|
914.6
|
|
||
Total property and equipment
|
|
1,557.1
|
|
|
1,586.3
|
|
||
Less accumulated depreciation
|
|
1,235.8
|
|
|
1,235.3
|
|
||
Property and equipment, net
|
|
321.3
|
|
|
351.0
|
|
||
Deferred income taxes
|
|
147.3
|
|
|
158.2
|
|
||
Goodwill
|
|
363.9
|
|
|
1,350.5
|
|
||
Other intangible assets, net
|
|
33.5
|
|
|
92.5
|
|
||
Other noncurrent assets
|
|
50.6
|
|
|
71.0
|
|
||
Total noncurrent assets
|
|
916.6
|
|
|
2,023.2
|
|
||
Total assets
|
|
$
|
4,044.3
|
|
|
$
|
5,041.6
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
1,051.9
|
|
|
$
|
892.3
|
|
Accrued liabilities
|
|
752.8
|
|
|
950.1
|
|
||
Income taxes payable
|
|
27.2
|
|
|
37.5
|
|
||
Current portion of debt, net
|
|
349.2
|
|
|
—
|
|
||
Liabilities held for sale
|
|
—
|
|
|
50.9
|
|
||
Total current liabilities
|
|
2,181.1
|
|
|
1,930.8
|
|
||
Deferred income taxes
|
|
0.1
|
|
|
5.0
|
|
||
Long-term debt, net
|
|
471.6
|
|
|
817.9
|
|
||
Other long-term liabilities
|
|
55.3
|
|
|
73.4
|
|
||
Total long-term liabilities
|
|
527.0
|
|
|
896.3
|
|
||
Total liabilities
|
|
2,708.1
|
|
|
2,827.1
|
|
||
Commitments and contingencies (Notes 8, 11 and 12)
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
||||
Class A common stock — $.001 par value; authorized 300.0 shares; 102.0 and 101.3 shares issued, 102.0 and 101.3 shares outstanding, respectively
|
|
0.1
|
|
|
0.1
|
|
||
Additional paid-in capital
|
|
27.7
|
|
|
22.1
|
|
||
Accumulated other comprehensive (loss) income
|
|
(54.3
|
)
|
|
12.2
|
|
||
Retained earnings
|
|
1,362.7
|
|
|
2,180.1
|
|
||
Total stockholders' equity
|
|
1,336.2
|
|
|
2,214.5
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
4,044.3
|
|
|
$
|
5,041.6
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net sales
|
|
$
|
8,285.3
|
|
|
$
|
8,547.1
|
|
|
$
|
7,965.0
|
|
Cost of sales
|
|
5,977.2
|
|
|
6,062.2
|
|
|
5,465.1
|
|
|||
Gross profit
|
|
2,308.1
|
|
|
2,484.9
|
|
|
2,499.9
|
|
|||
Selling, general and administrative expenses
|
|
1,888.6
|
|
|
1,909.6
|
|
|
1,861.9
|
|
|||
Depreciation and amortization
|
|
105.6
|
|
|
122.3
|
|
|
136.7
|
|
|||
Goodwill impairments
|
|
970.7
|
|
|
—
|
|
|
—
|
|
|||
Asset impairments
|
|
45.2
|
|
|
13.8
|
|
|
19.6
|
|
|||
Operating (loss) earnings
|
|
(702.0
|
)
|
|
439.2
|
|
|
481.7
|
|
|||
Interest income
|
|
(5.7
|
)
|
|
(1.5
|
)
|
|
(0.8
|
)
|
|||
Interest expense
|
|
56.8
|
|
|
56.8
|
|
|
53.8
|
|
|||
(Loss) earnings from continuing operations before income taxes
|
|
(753.1
|
)
|
|
383.9
|
|
|
428.7
|
|
|||
Income tax expense
|
|
41.7
|
|
|
153.5
|
|
|
124.2
|
|
|||
Net (loss) income from continuing operations
|
|
(794.8
|
)
|
|
230.4
|
|
|
304.5
|
|
|||
Income (loss) from discontinued operations, net of tax
|
|
121.8
|
|
|
(195.7
|
)
|
|
48.7
|
|
|||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
|
|
|
|
|
|
|
||||||
Basic (loss) earnings per share:
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
(7.79
|
)
|
|
$
|
2.27
|
|
|
$
|
2.94
|
|
Discontinued operations
|
|
1.19
|
|
|
(1.93
|
)
|
|
0.47
|
|
|||
Basic (loss) earnings per share
|
|
$
|
(6.59
|
)
|
|
$
|
0.34
|
|
|
$
|
3.42
|
|
|
|
|
|
|
|
|
||||||
Diluted (loss) earnings per share:
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
(7.79
|
)
|
|
$
|
2.27
|
|
|
$
|
2.93
|
|
Discontinued operations
|
|
1.19
|
|
|
(1.93
|
)
|
|
0.47
|
|
|||
Diluted (loss) earnings per share
|
|
$
|
(6.59
|
)
|
|
$
|
0.34
|
|
|
$
|
3.40
|
|
|
|
|
|
|
|
|
||||||
Weighted-average shares outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
102.1
|
|
|
101.4
|
|
|
103.4
|
|
|||
Diluted
|
|
102.1
|
|
|
101.5
|
|
|
103.8
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
(63.4
|
)
|
|
59.5
|
|
|
41.5
|
|
|||
Reclassification of realized gain on foreign currency translation adjustments, net of tax of $0
|
|
(3.1
|
)
|
|
—
|
|
|
—
|
|
|||
Total comprehensive (loss) income
|
|
$
|
(739.5
|
)
|
|
$
|
94.2
|
|
|
$
|
394.7
|
|
|
|
Class A
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained
Earnings
|
|
Total
Stockholders' Equity
|
|||||||||||||
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balance at January 31, 2016
|
|
103.3
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
(88.8
|
)
|
|
$
|
2,169.7
|
|
|
$
|
2,081.0
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353.2
|
|
|
353.2
|
|
|||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41.5
|
|
|
—
|
|
|
41.5
|
|
|||||
Dividends declared, $1.48 per common share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155.1
|
)
|
|
(155.1
|
)
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
17.8
|
|
|
—
|
|
|
—
|
|
|
17.8
|
|
|||||
Repurchases of common stock
|
|
(3.0
|
)
|
|
—
|
|
|
(8.6
|
)
|
|
—
|
|
|
(66.5
|
)
|
|
(75.1
|
)
|
|||||
Settlement of stock-based awards (including tax deficiency of $0.8)
|
|
0.7
|
|
|
—
|
|
|
(9.2
|
)
|
|
—
|
|
|
—
|
|
|
(9.2
|
)
|
|||||
Balance at January 28, 2017
|
|
101.0
|
|
|
0.1
|
|
|
—
|
|
|
(47.3
|
)
|
|
2,301.3
|
|
|
2,254.1
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34.7
|
|
|
34.7
|
|
|||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59.5
|
|
|
—
|
|
|
59.5
|
|
|||||
Dividends declared, $1.52 per common share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155.9
|
)
|
|
(155.9
|
)
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
25.6
|
|
|
—
|
|
|
—
|
|
|
25.6
|
|
|||||
Settlement of stock-based awards
|
|
0.3
|
|
|
—
|
|
|
(3.5
|
)
|
|
—
|
|
|
—
|
|
|
(3.5
|
)
|
|||||
Balance at February 3, 2018
|
|
101.3
|
|
|
0.1
|
|
|
22.1
|
|
|
12.2
|
|
|
2,180.1
|
|
|
2,214.5
|
|
|||||
Adoption of ASU 2014-09 (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.5
|
|
|
11.5
|
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(673.0
|
)
|
|
(673.0
|
)
|
|||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(66.5
|
)
|
|
—
|
|
|
(66.5
|
)
|
|||||
Dividends declared, $1.52 per common share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155.9
|
)
|
|
(155.9
|
)
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
10.7
|
|
|
—
|
|
|
—
|
|
|
10.7
|
|
|||||
Settlement of stock-based awards
|
|
0.7
|
|
|
—
|
|
|
(5.1
|
)
|
|
—
|
|
|
—
|
|
|
(5.1
|
)
|
|||||
Balance at February 2, 2019
|
|
102.0
|
|
|
$
|
0.1
|
|
|
$
|
27.7
|
|
|
$
|
(54.3
|
)
|
|
$
|
1,362.7
|
|
|
$
|
1,336.2
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
Adjustments to reconcile net (loss) income to net cash flows provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization (including amounts in cost of sales)
|
|
126.9
|
|
|
151.9
|
|
|
166.7
|
|
|||
Provision for inventory reserves
|
|
57.3
|
|
|
59.1
|
|
|
48.6
|
|
|||
Goodwill and asset impairments
|
|
1,015.9
|
|
|
395.1
|
|
|
33.8
|
|
|||
Stock-based compensation expense
|
|
10.7
|
|
|
25.6
|
|
|
17.8
|
|
|||
Deferred income taxes
|
|
(4.1
|
)
|
|
(107.9
|
)
|
|
(37.2
|
)
|
|||
Excess tax benefits related to stock-based awards
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|||
Loss on disposal of property and equipment
|
|
2.0
|
|
|
8.5
|
|
|
10.4
|
|
|||
Gain on divestiture
|
|
(100.8
|
)
|
|
(6.4
|
)
|
|
—
|
|
|||
Other
|
|
(36.2
|
)
|
|
(34.2
|
)
|
|
(33.1
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Receivables, net
|
|
(34.4
|
)
|
|
35.7
|
|
|
(43.9
|
)
|
|||
Merchandise inventories
|
|
(44.7
|
)
|
|
(256.3
|
)
|
|
14.7
|
|
|||
Prepaid expenses and other current assets
|
|
2.2
|
|
|
(1.2
|
)
|
|
(11.4
|
)
|
|||
Prepaid income taxes and income taxes payable
|
|
(18.7
|
)
|
|
(24.7
|
)
|
|
(49.1
|
)
|
|||
Accounts payable and accrued liabilities
|
|
17.1
|
|
|
169.8
|
|
|
64.1
|
|
|||
Changes in other long-term liabilities
|
|
4.9
|
|
|
(14.8
|
)
|
|
1.7
|
|
|||
Net cash flows provided by operating activities
|
|
325.1
|
|
|
434.9
|
|
|
537.1
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Purchase of property and equipment
|
|
(93.7
|
)
|
|
(113.4
|
)
|
|
(142.7
|
)
|
|||
Acquisitions, net of cash acquired
|
|
—
|
|
|
(8.5
|
)
|
|
(441.2
|
)
|
|||
Proceeds from divestiture, net of cash sold
|
|
727.9
|
|
|
58.5
|
|
|
—
|
|
|||
Other
|
|
1.3
|
|
|
2.8
|
|
|
6.5
|
|
|||
Net cash flows provided by (used in) investing activities
|
|
635.5
|
|
|
(60.6
|
)
|
|
(577.4
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Repayment of acquisition-related debt
|
|
(12.2
|
)
|
|
(21.8
|
)
|
|
(0.4
|
)
|
|||
Repurchase of common shares
|
|
—
|
|
|
(22.0
|
)
|
|
(63.1
|
)
|
|||
Dividends paid
|
|
(157.4
|
)
|
|
(155.2
|
)
|
|
(155.5
|
)
|
|||
Proceeds from senior notes
|
|
—
|
|
|
—
|
|
|
475.0
|
|
|||
Borrowings from the revolver
|
|
154.0
|
|
|
373.0
|
|
|
545.0
|
|
|||
Repayments of revolver borrowings
|
|
(154.0
|
)
|
|
(373.0
|
)
|
|
(545.0
|
)
|
|||
Payments of financing costs
|
|
—
|
|
|
—
|
|
|
(8.1
|
)
|
|||
Issuance of common stock, net of share repurchases for withholding taxes
|
|
(5.1
|
)
|
|
(3.5
|
)
|
|
(8.4
|
)
|
|||
Excess tax benefits related to stock-based awards
|
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|||
Net cash flows (used in) provided by financing activities
|
|
(174.7
|
)
|
|
(202.5
|
)
|
|
238.7
|
|
|||
Exchange rate effect on cash and cash equivalents and restricted cash
|
|
(24.7
|
)
|
|
28.0
|
|
|
21.1
|
|
|||
Decrease (increase) in cash held for sale
|
|
10.2
|
|
|
(5.4
|
)
|
|
(2.2
|
)
|
|||
Increase in cash and cash equivalents
|
|
771.4
|
|
|
194.4
|
|
|
217.3
|
|
|||
Cash and cash equivalents and restricted cash at beginning of period
|
|
869.1
|
|
|
674.7
|
|
|
457.4
|
|
|||
Cash and cash equivalents and restricted cash at end of period
|
|
$
|
1,640.5
|
|
|
$
|
869.1
|
|
|
$
|
674.7
|
|
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
|
||||||
Interest paid
|
|
$
|
53.5
|
|
|
$
|
53.4
|
|
|
$
|
38.0
|
|
Income taxes paid
|
|
$
|
122.9
|
|
|
$
|
168.3
|
|
|
$
|
230.1
|
|
|
|
February 2,
2019 |
|
February 3,
2018 |
|
January 28,
2017 |
||||||
Cash and cash equivalents
|
|
$
|
1,624.4
|
|
|
$
|
854.2
|
|
|
$
|
664.5
|
|
Restricted cash (included in prepaid expenses and other current assets)
|
|
2.7
|
|
|
—
|
|
|
—
|
|
|||
Restricted cash (included in other noncurrent assets)
|
|
13.4
|
|
|
14.9
|
|
|
10.2
|
|
|||
Total cash and cash equivalents and restricted cash in the statements of cash flows
|
|
$
|
1,640.5
|
|
|
$
|
869.1
|
|
|
$
|
674.7
|
|
|
|
Fiscal Year 2018
|
||||||||||
|
|
Under Prior Standard
|
|
Impact of New Standard
|
|
As Reported
|
||||||
Net sales
|
|
$
|
8,240.7
|
|
|
$
|
44.6
|
|
|
$
|
8,285.3
|
|
Cost of sales
|
|
5,937.1
|
|
|
40.1
|
|
|
5,977.2
|
|
|||
Gross profit
|
|
2,303.6
|
|
|
4.5
|
|
|
2,308.1
|
|
|||
Operating (loss) earnings from continuing operations
|
|
(706.5
|
)
|
|
4.5
|
|
|
(702.0
|
)
|
|||
(Loss) earnings from continuing operations before income taxes
|
|
(757.6
|
)
|
|
4.5
|
|
|
(753.1
|
)
|
|||
Income tax expense
|
|
40.5
|
|
|
1.2
|
|
|
41.7
|
|
|||
Net (loss) income from continuing operations
|
|
(798.1
|
)
|
|
3.3
|
|
|
(794.8
|
)
|
|
|
February 2, 2019
|
||||||||||
|
|
Under Prior Standard
|
|
Impact of New Standard
|
|
As Reported
|
||||||
Merchandise inventories, net
|
|
$
|
1,246.1
|
|
|
$
|
4.4
|
|
|
$
|
1,250.5
|
|
Total current assets
|
|
3,123.3
|
|
|
4.4
|
|
|
3,127.7
|
|
|||
Deferred income taxes
|
|
151.9
|
|
|
(4.6
|
)
|
|
147.3
|
|
|||
Total noncurrent assets
|
|
921.2
|
|
|
(4.6
|
)
|
|
916.6
|
|
|||
Total assets
|
|
4,044.5
|
|
|
(0.2
|
)
|
|
4,044.3
|
|
|||
|
|
|
|
|
|
|
||||||
Accrued liabilities
|
|
769.0
|
|
|
(16.2
|
)
|
|
752.8
|
|
|||
Income taxes payable
|
|
26.0
|
|
|
1.2
|
|
|
27.2
|
|
|||
Total current liabilities
|
|
2,196.1
|
|
|
(15.0
|
)
|
|
2,181.1
|
|
|||
Total liabilities
|
|
2,723.1
|
|
|
(15.0
|
)
|
|
2,708.1
|
|
|||
Retained earnings
|
|
1,347.9
|
|
|
14.8
|
|
|
1,362.7
|
|
|||
Total stockholders' equity
|
|
1,321.4
|
|
|
14.8
|
|
|
1,336.2
|
|
|||
Total liabilities and stockholders' equity
|
|
4,044.5
|
|
|
(0.2
|
)
|
|
4,044.3
|
|
|
Fiscal Year
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net sales
|
$
|
565.4
|
|
|
$
|
677.5
|
|
|
$
|
642.9
|
|
Cost of sales
|
73.1
|
|
|
122.3
|
|
|
133.5
|
|
|||
Gross profit
|
492.3
|
|
|
555.2
|
|
|
509.4
|
|
|||
Selling, general and administrative expenses
|
395.9
|
|
|
453.4
|
|
|
390.7
|
|
|||
Depreciation and amortization
|
20.1
|
|
|
28.4
|
|
|
28.5
|
|
|||
Goodwill impairments
|
—
|
|
|
32.8
|
|
|
—
|
|
|||
Asset impairments
|
—
|
|
|
344.2
|
|
|
14.2
|
|
|||
Operating earnings (loss)
|
76.3
|
|
|
(303.6
|
)
|
|
76.0
|
|
|||
Gain on sale of discontinued operations
|
100.8
|
|
|
—
|
|
|
—
|
|
|||
Earnings (loss) from discontinued operations before income taxes
|
177.1
|
|
|
(303.6
|
)
|
|
76.0
|
|
|||
Income tax expense (benefit)
|
55.3
|
|
|
(107.9
|
)
|
|
27.3
|
|
|||
Net income (loss) from discontinued operations
|
$
|
121.8
|
|
|
$
|
(195.7
|
)
|
|
$
|
48.7
|
|
|
February 3, 2018
|
||
Assets:
|
|
||
Cash and cash equivalents
|
$
|
10.2
|
|
Receivables, net
|
44.1
|
|
|
Merchandise inventories, net
|
116.4
|
|
|
Prepaid expenses and other current assets
|
9.7
|
|
|
Property and equipment, net
|
82.2
|
|
|
Goodwill
|
316.8
|
|
|
Other intangible assets, net
|
77.0
|
|
|
Other assets
|
3.7
|
|
|
Total assets held for sale
|
$
|
660.1
|
|
|
|
||
Liabilities:
|
|
||
Accounts payable
|
$
|
9.7
|
|
Accrued liabilities
|
26.0
|
|
|
Other liabilities
|
15.2
|
|
|
Total liabilities held for sale
|
$
|
50.9
|
|
|
Fiscal Year
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Capital expenditures
|
$
|
7.5
|
|
|
$
|
22.2
|
|
|
$
|
36.9
|
|
Depreciation and amortization
|
20.1
|
|
|
28.4
|
|
|
28.5
|
|
|||
Goodwill and asset impairments
|
—
|
|
|
377.0
|
|
|
14.2
|
|
|||
Provision for inventory reserves
|
12.7
|
|
|
12.9
|
|
|
17.6
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
New video game hardware
(1)
|
|
$
|
1,767.8
|
|
|
$
|
1,791.8
|
|
|
$
|
1,396.7
|
|
New video game software
|
|
2,449.7
|
|
|
2,582.0
|
|
|
2,493.4
|
|
|||
Pre-owned and value video game products
|
|
1,866.3
|
|
|
2,149.6
|
|
|
2,254.1
|
|
|||
Video game accessories
|
|
956.5
|
|
|
784.3
|
|
|
676.7
|
|
|||
Digital
|
|
194.0
|
|
|
189.2
|
|
|
181.0
|
|
|||
Collectibles
|
|
707.5
|
|
|
636.2
|
|
|
494.1
|
|
|||
Other
(2)
|
|
343.5
|
|
|
414.0
|
|
|
469.0
|
|
|||
Total
|
|
$
|
8,285.3
|
|
|
$
|
8,547.1
|
|
|
$
|
7,965.0
|
|
(1)
|
Includes sales of hardware bundles, in which physical hardware and digital or physical software are sold together as a single SKU.
|
(2)
|
Includes mobile and consumer electronics sold through our Simply Mac and Cricket Wireless branded stores. We sold our Cricket Wireless branded stores in January 2018. Also includes sales of PC entertainment software, interactive game figures, strategy guides, mobile and consumer electronics sold through our Video Game Brands segments, and revenues from PowerUp Pro loyalty members receiving
Game Informer
magazine in print form.
|
|
|
Contract Liabilities
|
||
Balance at February 3, 2018
|
|
$
|
426.0
|
|
Adoption of ASU 2014-09
|
|
(16.8
|
)
|
|
Increase to contract liabilities
(1)
|
|
1,238.1
|
|
|
Decrease to contract liabilities
(2)
|
|
(1,262.9
|
)
|
|
Other adjustments
(3)
|
|
(7.5
|
)
|
|
Balance at February 2, 2019
|
|
$
|
376.9
|
|
(1)
|
Includes issuances of gift cards, trade-in credits and loyalty points, new reservation deposits, new subscriptions to
Game Informer
and extended warranties sold.
|
(2)
|
Includes redemptions of gift cards, trade-in credits, loyalty points and reservation deposits as well as revenues recognized for
Game Informer
and extended warranties. During the
52 weeks ended February 2, 2019
, there were
$65.8 million
of gift cards redeemed that were outstanding as of
February 3, 2018
.
|
(3)
|
Primarily includes foreign currency translation adjustments.
|
|
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Total
|
||||||||||
Fiscal 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intangible asset impairment charges
|
|
$
|
11.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
31.9
|
|
|
$
|
43.1
|
|
Store and other asset impairment charges
|
|
1.3
|
|
|
—
|
|
|
0.2
|
|
|
0.6
|
|
|
2.1
|
|
|||||
Total
|
|
$
|
12.5
|
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
$
|
32.5
|
|
|
$
|
45.2
|
|
Fiscal 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intangible asset impairment charges
|
|
$
|
11.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11.0
|
|
Store and other asset impairment charges
|
|
1.3
|
|
|
—
|
|
|
0.3
|
|
|
1.2
|
|
|
2.8
|
|
|||||
Total
|
|
$
|
12.3
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
1.2
|
|
|
$
|
13.8
|
|
Fiscal 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intangible asset impairment charges
|
|
$
|
7.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
|
$
|
14.4
|
|
Store and other asset impairment charges
|
|
2.7
|
|
|
0.2
|
|
|
—
|
|
|
2.3
|
|
|
5.2
|
|
|||||
Total
|
|
$
|
9.7
|
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
9.7
|
|
|
$
|
19.6
|
|
|
|
February 2, 2019
|
|
February 3, 2018
|
||||||||||||
|
|
Level 2
|
|
Level 3
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
(1)
|
|
$
|
1.0
|
|
|
$
|
—
|
|
|
$
|
2.4
|
|
|
$
|
—
|
|
Company-owned life insurance
(2)
|
|
14.6
|
|
|
—
|
|
|
13.9
|
|
|
—
|
|
||||
Total assets
|
|
$
|
15.6
|
|
|
$
|
—
|
|
|
$
|
16.3
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
(3)
|
|
$
|
1.2
|
|
|
$
|
—
|
|
|
$
|
9.9
|
|
|
$
|
—
|
|
Nonqualified deferred compensation
(3)
|
|
1.1
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
||||
Contingent consideration
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12.2
|
|
||||
Total liabilities
|
|
$
|
2.3
|
|
|
$
|
—
|
|
|
$
|
11.1
|
|
|
$
|
12.2
|
|
(1)
|
Recognized in prepaid expenses and other current assets in our consolidated balance sheets.
|
(2)
|
Recognized in other non-current assets in our consolidated balance sheets.
|
(3)
|
Recognized in accrued liabilities in our consolidated balance sheets.
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Gains (losses) on the changes in fair value of derivative instruments
|
|
$
|
9.6
|
|
|
$
|
(24.6
|
)
|
|
$
|
20.0
|
|
(Losses) gains on the re-measurement of related intercompany loans and foreign currency assets and liabilities
|
|
(6.6
|
)
|
|
27.0
|
|
|
(15.5
|
)
|
|||
Net gains
|
|
$
|
3.0
|
|
|
$
|
2.4
|
|
|
$
|
4.5
|
|
|
|
February 2, 2019
|
|
February 3, 2018
|
||||
Bankcard receivables
|
|
$
|
44.6
|
|
|
$
|
49.2
|
|
Vendor and other receivables
(1)
|
|
93.6
|
|
|
97.1
|
|
||
Allowance for doubtful accounts
|
|
(4.0
|
)
|
|
(7.7
|
)
|
||
Total receivables, net
|
|
$
|
134.2
|
|
|
$
|
138.6
|
|
(1)
|
Vendor receivables primarily relate to vendor allowances.
|
|
|
United States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Technology Brands
|
|
Total
|
||||||||||||
Balance at January 28, 2017—as reported
|
|
$
|
1,199.7
|
|
|
$
|
28.6
|
|
|
$
|
70.1
|
|
|
$
|
74.8
|
|
|
$
|
352.0
|
|
|
$
|
1,725.2
|
|
Transfers
(1)
|
|
2.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(352.0
|
)
|
|
(349.6
|
)
|
||||||
Balance at January 28, 2017—after transfers
|
|
1,202.1
|
|
|
28.6
|
|
|
70.1
|
|
|
74.8
|
|
|
—
|
|
|
1,375.6
|
|
||||||
Divestitures (Note 2)
|
|
(42.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42.6
|
)
|
||||||
Foreign currency translation adjustment
|
|
—
|
|
|
1.7
|
|
|
3.5
|
|
|
12.3
|
|
|
—
|
|
|
17.5
|
|
||||||
Balance at February 3, 2018
|
|
1,159.5
|
|
|
30.3
|
|
|
73.6
|
|
|
87.1
|
|
|
—
|
|
|
1,350.5
|
|
||||||
Foreign currency translation adjustment
|
|
—
|
|
|
(1.5
|
)
|
|
(7.2
|
)
|
|
(7.2
|
)
|
|
—
|
|
|
(15.9
|
)
|
||||||
Impairment charge
|
|
(795.6
|
)
|
|
(28.8
|
)
|
|
(66.4
|
)
|
|
(79.9
|
)
|
|
—
|
|
|
(970.7
|
)
|
||||||
Balance at February 2, 2019
|
|
$
|
363.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
363.9
|
|
(1)
|
As a result of the divestiture of Spring Mobile, which was completed in January 2019, we allocated the goodwill balance associated with our former Technology Brands segment for the earliest period presented to Spring Mobile, Simply Mac and Cricket Wireless based on their relative fair values. Simply Mac and the historical results of Cricket Wireless are included in the United States segment. We allocated
$349.6 million
of goodwill to Spring Mobile which was impaired by
$32.8 million
during fiscal 2017. As of February 3, 2018, goodwill of
$316.8 million
related to Spring Mobile is included in assets held for sale in our consolidated balance sheets.
|
|
|
February 2, 2019
|
|
February 3, 2018
|
||||||||||||||||||||
|
|
Gross Carrying Amount(1)
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
Intangible assets with indefinite lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade names
|
|
$
|
8.8
|
|
|
$
|
—
|
|
|
$
|
8.8
|
|
|
$
|
49.3
|
|
|
$
|
—
|
|
|
$
|
49.3
|
|
Intangible assets with finite lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Leasehold rights
|
|
91.8
|
|
|
(67.3
|
)
|
|
24.5
|
|
|
100.4
|
|
|
(67.0
|
)
|
|
33.4
|
|
||||||
Customer relationships
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14.5
|
|
|
(6.8
|
)
|
|
7.7
|
|
||||||
Other
|
|
32.5
|
|
|
(32.3
|
)
|
|
0.2
|
|
|
33.5
|
|
|
(31.4
|
)
|
|
2.1
|
|
||||||
Total
|
|
$
|
133.1
|
|
|
$
|
(99.6
|
)
|
|
$
|
33.5
|
|
|
$
|
197.7
|
|
|
$
|
(105.2
|
)
|
|
$
|
92.5
|
|
(1)
|
The change in the gross carrying amount of intangible assets from
February 3, 2018
to
February 2, 2019
is due to impairments (see Note 4, "Asset Impairments") and the impact of exchange rate fluctuations.
|
Period
|
|
Projected Amortization Expense
|
||
Fiscal 2019
|
|
$
|
5.5
|
|
Fiscal 2020
|
|
4.5
|
|
|
Fiscal 2021
|
|
3.7
|
|
|
Fiscal 2022
|
|
3.2
|
|
|
Fiscal 2023
|
|
2.6
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current tax expense:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
45.0
|
|
|
$
|
104.7
|
|
|
$
|
122.2
|
|
State
|
|
12.8
|
|
|
14.2
|
|
|
9.6
|
|
|||
Foreign
|
|
38.5
|
|
|
28.5
|
|
|
29.2
|
|
|||
|
|
96.3
|
|
|
147.4
|
|
|
161.0
|
|
|||
Deferred tax (benefit) expense:
|
|
|
|
|
|
|
||||||
Federal
|
|
(36.0
|
)
|
|
23.4
|
|
|
(3.1
|
)
|
|||
State
|
|
(4.0
|
)
|
|
(1.3
|
)
|
|
(0.1
|
)
|
|||
Foreign
|
|
(14.6
|
)
|
|
(16.0
|
)
|
|
(33.6
|
)
|
|||
|
|
(54.6
|
)
|
|
6.1
|
|
|
(36.8
|
)
|
|||
Total income tax expense
|
|
$
|
41.7
|
|
|
$
|
153.5
|
|
|
$
|
124.2
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
United States
|
|
$
|
(543.4
|
)
|
|
$
|
310.7
|
|
|
$
|
370.8
|
|
International
|
|
(209.7
|
)
|
|
73.2
|
|
|
57.9
|
|
|||
Total
|
|
$
|
(753.1
|
)
|
|
$
|
383.9
|
|
|
$
|
428.7
|
|
(1)
|
Per IRC Section 15, we have incorporated a statutory rate of
21.0%
for our year end current provision ending February 2, 2019.
|
(2)
|
In fiscal 2016, we adopted a plan of reorganization specific to certain foreign operations which resulted in our ability to recognize the benefit of foreign net operating loss carryforwards that were previously unrecognized in affected jurisdictions. As a result, we recognized a tax benefit of
$42.1 million
in the fourth quarter of fiscal 2016, which is subject to a partial valuation allowance of
$14.8 million
. The valuation allowance established for this tax benefit is reflected in the line item “Change in valuation allowance.”
|
(3)
|
Other is comprised of numerous items, none of which is greater than
1.05%
of loss before income taxes for fiscal 2018,
1.69%
of earnings before income taxes for fiscal 2017, and
1.75%
of earnings before income taxes for fiscal 2016.
|
|
|
February 2, 2019
|
|
February 3, 2018
|
||||
Deferred tax asset:
|
|
|
|
|
||||
Inventory
|
|
$
|
14.7
|
|
|
$
|
16.8
|
|
Deferred rents
|
|
3.9
|
|
|
6.9
|
|
||
Stock-based compensation
|
|
1.8
|
|
|
9.2
|
|
||
Net operating losses
|
|
78.5
|
|
|
86.2
|
|
||
Customer liabilities
|
|
18.6
|
|
|
16.6
|
|
||
Property and equipment
|
|
11.3
|
|
|
13.6
|
|
||
Credits
|
|
18.2
|
|
|
9.5
|
|
||
Accrued compensation
|
|
12.1
|
|
|
12.9
|
|
||
Intangible assets
|
|
21.8
|
|
|
63.2
|
|
||
Other
|
|
13.1
|
|
|
12.9
|
|
||
Total deferred tax assets
|
|
194.0
|
|
|
247.8
|
|
||
Valuation allowance
|
|
(32.9
|
)
|
|
(36.9
|
)
|
||
Total deferred tax assets, net
|
|
161.1
|
|
|
210.9
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Goodwill
|
|
(10.2
|
)
|
|
(49.9
|
)
|
||
Prepaid expenses
|
|
(3.6
|
)
|
|
(4.5
|
)
|
||
Other
|
|
(0.1
|
)
|
|
(3.3
|
)
|
||
Total deferred tax liabilities
|
|
(13.9
|
)
|
|
(57.7
|
)
|
||
Net deferred tax assets
|
|
$
|
147.2
|
|
|
$
|
153.2
|
|
The above amounts are reflected in the consolidated financial statements as:
|
|
|
|
|
||||
Deferred income taxes - assets
|
|
$
|
147.3
|
|
|
$
|
158.2
|
|
Deferred income taxes - liabilities
|
|
$
|
(0.1
|
)
|
|
$
|
(5.0
|
)
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Beginning balance of unrecognized tax benefits
|
|
$
|
24.9
|
|
|
$
|
42.1
|
|
|
$
|
31.9
|
|
Increases related to current period tax positions
|
|
1.1
|
|
|
1.0
|
|
|
3.5
|
|
|||
Increases related to prior period tax positions
|
|
35.5
|
|
|
11.2
|
|
|
7.9
|
|
|||
Reductions as a result of a lapse of the applicable statute of limitations
|
|
(0.6
|
)
|
|
(1.3
|
)
|
|
(0.2
|
)
|
|||
Reductions as a result of settlements with taxing authorities
|
|
(38.4
|
)
|
|
(28.1
|
)
|
|
(1.0
|
)
|
|||
Ending balance of unrecognized tax benefits
|
|
$
|
22.5
|
|
|
$
|
24.9
|
|
|
$
|
42.1
|
|
|
|
February 2, 2019
|
|
February 3, 2018
|
||||
Customer-related liabilities
|
|
$
|
268.7
|
|
|
$
|
302.2
|
|
Deferred revenue
|
|
124.2
|
|
|
132.4
|
|
||
Employee benefits, compensation and related taxes
|
|
140.7
|
|
|
152.2
|
|
||
Checks and transfers yet to be presented for payment from zero balance cash accounts
|
|
82.7
|
|
|
176.4
|
|
||
Other taxes
|
|
45.5
|
|
|
63.4
|
|
||
Other accrued liabilities
(1)
|
|
91.0
|
|
|
123.5
|
|
||
Total accrued liabilities
|
|
$
|
752.8
|
|
|
$
|
950.1
|
|
(1)
|
Includes acquisition-related contingent consideration of
$12.2 million
as of
February 3, 2018
. See Note 5, "Fair Value Measurements and Financial Instruments" for additional information.
|
|
February 2, 2019
|
|
February 3, 2018
|
||||
2019 Senior Notes principal amount
|
$
|
350.0
|
|
|
$
|
350.0
|
|
2021 Senior Notes principal amount
|
475.0
|
|
|
475.0
|
|
||
Less: Unamortized debt financing costs
|
(4.2
|
)
|
|
(7.1
|
)
|
||
|
820.8
|
|
|
817.9
|
|
||
Less: Current portion
|
(349.2
|
)
|
|
—
|
|
||
Long-term debt, net
|
$
|
471.6
|
|
|
$
|
817.9
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Minimum
|
|
$
|
350.5
|
|
|
$
|
357.0
|
|
|
$
|
355.9
|
|
Percentage rentals
|
|
7.1
|
|
|
8.3
|
|
|
6.5
|
|
|||
Total rent expense
|
|
$
|
357.6
|
|
|
$
|
365.3
|
|
|
$
|
362.4
|
|
Period
|
|
|
||
Fiscal 2019
|
$
|
296.2
|
|
|
Fiscal 2020
|
208.7
|
|
||
Fiscal 2021
|
149.1
|
|
||
Fiscal 2022
|
105.4
|
|
||
Fiscal 2023
|
71.4
|
|
||
Thereafter
|
116.2
|
|
||
|
|
$
|
947.0
|
|
|
|
Fiscal Year 2016
|
||
Total number of shares purchased
|
|
3.0
|
|
|
Average price per share
|
|
$
|
24.94
|
|
Aggregate value of shares purchased
|
|
$
|
75.1
|
|
|
|
Options
|
|
Weighted-
Average
Exercise
Price
|
|||
Balance, February 3, 2018
|
|
1,194,025
|
|
|
$
|
35.30
|
|
Expired
|
|
(594,770
|
)
|
|
$
|
41.84
|
|
Balance, February 2, 2019
|
|
599,255
|
|
|
$
|
28.81
|
|
|
|
Time-Based Restricted Stock Awards
|
|
Performance-Based Restricted Stock Awards
|
||||||||||
|
|
Shares
|
|
Weighted-
Average Grant Date Fair Value |
|
Shares
|
|
Weighted-
Average
Grant Date
Fair Value
|
||||||
Nonvested shares at February 3, 2018
|
|
912,360
|
|
|
$
|
27.96
|
|
|
553,189
|
|
|
$
|
28.83
|
|
Granted
|
|
969,043
|
|
|
$
|
15.67
|
|
|
257,667
|
|
|
$
|
15.80
|
|
Vested
|
|
(791,891
|
)
|
|
$
|
25.66
|
|
|
(298,454
|
)
|
|
$
|
30.49
|
|
Forfeited
|
|
(282,484
|
)
|
|
$
|
19.86
|
|
|
(225,095
|
)
|
|
$
|
22.56
|
|
Nonvested shares at February 2, 2019
|
|
807,028
|
|
|
$
|
18.30
|
|
|
287,307
|
|
|
$
|
20.33
|
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net (loss) income from continuing operations
|
|
$
|
(794.8
|
)
|
|
$
|
230.4
|
|
|
$
|
304.5
|
|
Income (loss) from discontinued operations, net of tax
|
|
121.8
|
|
|
(195.7
|
)
|
|
48.7
|
|
|||
Net (loss) income
|
|
$
|
(673.0
|
)
|
|
$
|
34.7
|
|
|
$
|
353.2
|
|
|
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding
|
|
102.1
|
|
|
101.4
|
|
|
103.4
|
|
|||
Dilutive effect of stock options and restricted stock awards
|
|
—
|
|
|
0.1
|
|
|
0.4
|
|
|||
Weighted-average diluted common shares
|
|
102.1
|
|
|
101.5
|
|
|
103.8
|
|
|||
|
|
|
|
|
|
|
||||||
Basic (loss) earnings per share:
(1)
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
(7.79
|
)
|
|
$
|
2.27
|
|
|
$
|
2.94
|
|
Discontinued operations
|
|
1.19
|
|
|
(1.93
|
)
|
|
0.47
|
|
|||
Basic (loss) earnings per share
|
|
$
|
(6.59
|
)
|
|
$
|
0.34
|
|
|
$
|
3.42
|
|
|
|
|
|
|
|
|
||||||
Diluted (loss) earnings per share:
(1)
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
(7.79
|
)
|
|
$
|
2.27
|
|
|
$
|
2.93
|
|
Discontinued operations
|
|
1.19
|
|
|
(1.93
|
)
|
|
0.47
|
|
|||
Diluted (loss) earnings per share
|
|
$
|
(6.59
|
)
|
|
$
|
0.34
|
|
|
$
|
3.40
|
|
|
|
|
|
|
|
|
||||||
Anti-dilutive stock options and restricted stock awards
|
|
1.7
|
|
|
2.0
|
|
|
1.4
|
|
(1)
|
The sum of (loss) earnings per share may not total to consolidated (loss) earnings per common share as amounts are calculated based on whole numbers.
|
|
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Total
|
||||||||||
As of and for the Fiscal Year Ended February 2, 2019
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
5,800.2
|
|
|
$
|
434.5
|
|
|
$
|
645.4
|
|
|
$
|
1,405.2
|
|
|
$
|
8,285.3
|
|
Operating loss
|
|
(533.9
|
)
|
|
(19.3
|
)
|
|
(46.5
|
)
|
|
(102.3
|
)
|
|
(702.0
|
)
|
|||||
Depreciation and amortization
|
|
67.1
|
|
|
3.7
|
|
|
9.8
|
|
|
25.0
|
|
|
105.6
|
|
|||||
Goodwill impairments
|
|
795.6
|
|
|
28.8
|
|
|
66.4
|
|
|
79.9
|
|
|
970.7
|
|
|||||
Asset impairments
|
|
12.5
|
|
|
—
|
|
|
0.2
|
|
|
32.5
|
|
|
45.2
|
|
|||||
Capital expenditures
|
|
51.5
|
|
|
4.4
|
|
|
10.5
|
|
|
19.8
|
|
|
86.2
|
|
|||||
Property and equipment, net
|
|
188.7
|
|
|
17.1
|
|
|
40.6
|
|
|
74.9
|
|
|
321.3
|
|
|||||
Total segment assets
|
|
2,889.5
|
|
|
144.4
|
|
|
301.2
|
|
|
709.2
|
|
|
4,044.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of and for the Fiscal Year Ended February 3, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
5,876.0
|
|
|
$
|
434.9
|
|
|
$
|
702.2
|
|
|
$
|
1,534.0
|
|
|
$
|
8,547.1
|
|
Operating earnings
|
|
332.8
|
|
|
18.5
|
|
|
34.9
|
|
|
53.0
|
|
|
439.2
|
|
|||||
Depreciation and amortization
|
|
81.6
|
|
|
3.9
|
|
|
10.4
|
|
|
26.4
|
|
|
122.3
|
|
|||||
Asset impairments
|
|
12.3
|
|
|
—
|
|
|
0.3
|
|
|
1.2
|
|
|
13.8
|
|
|||||
Capital expenditures
|
|
61.5
|
|
|
4.3
|
|
|
10.1
|
|
|
15.3
|
|
|
91.2
|
|
|||||
Property and equipment, net
|
|
207.6
|
|
|
17.4
|
|
|
44.2
|
|
|
81.8
|
|
|
351.0
|
|
|||||
Total segment assets
(1)
|
|
2,919.0
|
|
|
187.3
|
|
|
457.5
|
|
|
817.7
|
|
|
4,381.5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of and for the Fiscal Year Ended January 28, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
5,660.0
|
|
|
$
|
382.0
|
|
|
$
|
609.5
|
|
|
$
|
1,313.5
|
|
|
$
|
7,965.0
|
|
Operating earnings
|
|
398.4
|
|
|
22.4
|
|
|
34.9
|
|
|
26.0
|
|
|
481.7
|
|
|||||
Depreciation and amortization
|
|
98.5
|
|
|
3.8
|
|
|
9.4
|
|
|
25.0
|
|
|
136.7
|
|
|||||
Asset impairments
|
|
9.7
|
|
|
0.2
|
|
|
—
|
|
|
9.7
|
|
|
19.6
|
|
|||||
Capital expenditures
|
|
63.6
|
|
|
1.3
|
|
|
15.1
|
|
|
25.8
|
|
|
105.8
|
|
|||||
Property and equipment, net
|
|
226.9
|
|
|
16.1
|
|
|
43.4
|
|
|
76.9
|
|
|
363.3
|
|
|||||
Total segment assets
|
|
2,628.7
|
|
|
271.6
|
|
|
434.6
|
|
|
567.9
|
|
|
3,902.8
|
|
(1)
|
The total segment assets for the United States and Europe as of fiscal year ended February 3, 2018, have been revised to correct an error. See Note 1, "Nature of Operations and Summary of Significant Accounting Policies," for additional information.
|
|
|
Fiscal Year
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Total segment capital expenditures
|
|
$
|
86.2
|
|
|
$
|
91.2
|
|
|
$
|
105.8
|
|
Discontinued operations
|
|
7.5
|
|
|
22.2
|
|
|
36.9
|
|
|||
Total capital expenditures
|
|
$
|
93.7
|
|
|
$
|
113.4
|
|
|
$
|
142.7
|
|
|
|
February 2,
2019
|
|
February 3,
2018
|
||||
Total segment assets
|
|
$
|
4,044.3
|
|
|
$
|
4,381.5
|
|
Assets held for sale
|
|
—
|
|
|
660.1
|
|
||
Consolidated total assets
|
|
$
|
4,044.3
|
|
|
$
|
5,041.6
|
|
|
|
Fiscal Year 2018
|
|
Fiscal Year 2017
|
||||||||||||||||||||||||||||
|
|
1st
Quarter
|
|
2nd
Quarter
|
|
3rd
Quarter
(2)
|
|
4th
Quarter (2) |
|
1st
Quarter
|
|
2nd
Quarter
|
|
3rd
Quarter
|
|
4th
Quarter
(2)
|
||||||||||||||||
Net sales
(1)
|
|
$
|
1,785.8
|
|
|
$
|
1,501.1
|
|
|
$
|
1,935.4
|
|
|
$
|
3,063.0
|
|
|
$
|
1,874.0
|
|
|
$
|
1,529.5
|
|
|
$
|
1,827.6
|
|
|
$
|
3,316.0
|
|
Gross profit
(1)
|
|
531.1
|
|
|
470.0
|
|
|
558.2
|
|
|
748.8
|
|
|
567.2
|
|
|
493.2
|
|
|
559.8
|
|
|
864.7
|
|
||||||||
Operating earnings (loss)
(1)
|
|
46.5
|
|
|
1.5
|
|
|
(517.9
|
)
|
|
(232.1
|
)
|
|
89.3
|
|
|
26.9
|
|
|
71.9
|
|
|
251.1
|
|
||||||||
Net income (loss) from continuing operations
|
|
20.4
|
|
|
(39.8
|
)
|
|
(506.9
|
)
|
|
(268.5
|
)
|
|
51.8
|
|
|
12.0
|
|
|
49.7
|
|
|
116.9
|
|
||||||||
Income (loss) from discontinued operations, net of tax
|
|
7.8
|
|
|
14.9
|
|
|
18.3
|
|
|
80.8
|
|
|
7.2
|
|
|
10.2
|
|
|
9.7
|
|
|
(222.8
|
)
|
||||||||
Net (loss) income
|
|
28.2
|
|
|
(24.9
|
)
|
|
(488.6
|
)
|
|
(187.7
|
)
|
|
59.0
|
|
|
22.2
|
|
|
59.4
|
|
|
(105.9
|
)
|
||||||||
Basic earnings (loss) per share:
(3) (4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Continuing operations
|
|
$
|
0.20
|
|
|
$
|
(0.39
|
)
|
|
$
|
(4.96
|
)
|
|
$
|
(2.63
|
)
|
|
$
|
0.51
|
|
|
$
|
0.12
|
|
|
$
|
0.49
|
|
|
$
|
1.15
|
|
Discontinued operations
|
|
0.08
|
|
|
0.15
|
|
|
0.18
|
|
|
0.79
|
|
|
0.07
|
|
|
0.10
|
|
|
0.10
|
|
|
(2.20
|
)
|
||||||||
Basic earnings (loss) per share
|
|
$
|
0.28
|
|
|
$
|
(0.24
|
)
|
|
$
|
(4.78
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
0.58
|
|
|
$
|
0.22
|
|
|
$
|
0.59
|
|
|
$
|
(1.04
|
)
|
Diluted earnings (loss) per share:
(3) (4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Continuing operations
|
|
$
|
0.20
|
|
|
$
|
(0.39
|
)
|
|
$
|
(4.96
|
)
|
|
$
|
(2.63
|
)
|
|
$
|
0.51
|
|
|
$
|
0.12
|
|
|
$
|
0.49
|
|
|
$
|
1.15
|
|
Discontinued operations
|
|
0.08
|
|
|
0.15
|
|
|
0.18
|
|
|
0.79
|
|
|
0.07
|
|
|
0.10
|
|
|
0.10
|
|
|
(2.19
|
)
|
||||||||
Diluted earnings (loss) per share
|
|
$
|
0.28
|
|
|
$
|
(0.24
|
)
|
|
$
|
(4.78
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
0.58
|
|
|
$
|
0.22
|
|
|
$
|
0.59
|
|
|
$
|
(1.04
|
)
|
Dividend declared per common share
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
(1)
|
Net sales, gross profit and operating earnings (loss) differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as a result of our former Spring Mobile business being classified as discontinued operations for all periods presented. See Note 2, "Discontinued Operations and Dispositions," for additional information.
|
(2)
|
The results of operations for the fourth quarter of fiscal
2018
include goodwill and asset impairment charges totaling
$428.4 million
on a pre-tax basis. The results of operations for the third quarter of fiscal
2018
include goodwill and asset impairment charges totaling
$587.5 million
on a pre-tax basis. The results of operations for the fourth quarter of fiscal
2017
include goodwill and asset impairment charges totaling
$13.8 million
on a pre-tax basis.
|
(3)
|
The sum of the quarters may not necessarily be equal to the full year (loss) earnings per common share amount.
|
(4)
|
The sum of (loss) earnings per share may not total to consolidated (loss) earnings per common share as amounts are calculated based on whole numbers.
|
Exhibit
Number
|
|
Description
|
|
Previously Filed as an Exhibit to and
Incorporated by Reference From
|
|
Date Filed
|
|
|
|
|
|
|
|
2.1
|
|
|
Current Report on Form 8-K
|
|
November 21, 2018
|
|
|
|
|
|
|
|
|
3.1
|
|
|
Quarterly Report on Form 10-Q for the fiscal quarter ended August 3, 2013
|
|
September 11, 2013
|
|
|
|
|
|
|
|
|
3.2
|
|
|
Current Report on Form 8-K
|
|
March 6, 2017
|
|
|
|
|
|
|
|
|
4.1
|
|
|
Current Report on Form 8-K
|
|
September 24, 2014
|
|
|
|
|
|
|
|
|
4.2
|
|
|
Current Report on Form 8-K
|
|
September 24, 2014
|
|
|
|
|
|
|
|
|
4.3
|
|
|
Current Report on Form 8-K
|
|
March 9, 2016
|
|
|
|
|
|
|
|
|
4.4
|
|
|
Current Report on Form 8-K
|
|
March 9, 2016
|
|
|
|
|
|
|
|
|
4.5
|
|
|
Current Report on Form 8-K
|
|
March 9, 2016
|
|
|
|
|
|
|
|
|
10.1*
|
|
|
Definitive Proxy Statement for 2009 Annual Meeting of Stockholders
|
|
May 22, 2009
|
|
|
|
|
|
|
|
|
10.2*
|
|
|
Current Report on Form 8-K
|
|
June 27, 2013
|
|
|
|
|
|
|
|
|
10.3*
|
|
|
Annual Report on Form 10-K for the fiscal year ended January 29, 2005
|
|
April 11, 2005
|
|
|
|
|
|
|
|
|
10.4*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.5*
|
|
|
Current Report on Form 8-K
|
|
May 13, 2013
|
|
|
|
|
|
|
|
|
10.6*
|
|
|
Current Report on Form 8-K
|
|
March 6, 2018
|
|
|
|
|
|
|
|
|
10.7*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.8*
|
|
|
Current Report on Form 8-K
|
|
May 13, 2013
|
|
|
|
|
|
|
|
|
10.9*
|
|
|
Current Report on Form 8-K
|
|
May 13, 2013
|
|
|
|
|
|
|
|
|
10.10*
|
|
|
Current Report on Form 8-K
|
|
March 6, 2018
|
|
|
|
|
|
|
|
|
10.11*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Previously Filed as an Exhibit to and
Incorporated by Reference From
|
|
Date Filed
|
10.12*
|
|
|
Current Report on Form 8-K
|
|
May 13, 2013
|
|
|
|
|
|
|
|
|
10.13*
|
|
|
Current Report on Form 8-K
|
|
March 6, 2018
|
|
|
|
|
|
|
|
|
10.14*
|
|
|
Current Report on Form 8-K
|
|
May 13, 2013
|
|
|
|
|
|
|
|
|
10.15*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 1, 2014
|
|
April 2, 2014
|
|
|
|
|
|
|
|
|
10.16
|
|
|
Current Report on Form 8-K
|
|
March 28, 2014
|
|
|
|
|
|
|
|
|
10.17
|
|
|
Current Report on Form 8-K
|
|
September 16, 2014
|
|
|
|
|
|
|
|
|
10.18
|
|
|
Current Report on Form 8-K
|
|
November 21, 2017
|
|
|
|
|
|
|
|
|
10.19
|
|
|
Current Report on Form 8-K
|
|
December 12, 2018
|
|
|
|
|
|
|
|
|
10.20
|
|
|
Current Report on Form 8-K
|
|
November 21, 2017
|
|
|
|
|
|
|
|
|
10.21
|
|
|
Current Report on Form 8-K
|
|
March 28, 2014
|
|
|
|
|
|
|
|
|
10.22
|
|
|
Current Report on Form 8-K
|
|
November 21, 2017
|
|
|
|
|
|
|
|
|
10.23
|
|
|
Current Report on Form 8-K
|
|
March 28, 2014
|
|
|
|
|
|
|
|
|
10.24*
|
|
|
Annual Report on Form 10-K for the fiscal year ended January 30, 2015
|
|
March 28, 2016
|
|
|
|
|
|
|
|
|
10.25*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.26*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.27*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.28*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.29*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.30*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Previously Filed as an Exhibit to and
Incorporated by Reference From
|
|
Date Filed
|
10.31*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.32*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.33*
|
|
|
Annual Report on Form 10-K for the fiscal year ended February 3, 2018
|
|
April 2, 2018
|
|
|
|
|
|
|
|
|
10.34*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.35*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.36*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.37*
|
|
|
Current Report on Form 8-K
|
|
June 4, 2018
|
|
|
|
|
|
|
|
|
10.38*
|
|
|
Current Report on Form 8-K
|
|
December 21, 2017
|
|
|
|
|
|
|
|
|
21.1
|
|
|
Filed herewith.
|
|
|
|
|
|
|
|
|
|
|
23.1
|
|
|
Filed herewith.
|
|
|
|
|
|
|
|
|
|
|
31.1
|
|
|
Filed herewith.
|
|
|
|
|
|
|
|
|
|
|
31.2
|
|
|
Filed herewith.
|
|
|
|
|
|
|
|
|
|
|
32.1
|
|
|
Furnished herewith.
|
|
|
|
|
|
|
|
|
|
|
32.2
|
|
|
Furnished herewith.
|
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase.
|
|
Submitted electronically herewith.
|
|
|
|
|
|
|
|
|
/s/ DELOITTE & TOUCHE LLP
|
1
|
I have reviewed this Annual Report on Form 10-K of GameStop Corp.;
|
2
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
By:
|
/s/ Shane S. Kim
|
|
|
Shane S. Kim
|
|
|
Interim Chief Executive Officer and Director
|
|
|
GameStop Corp.
|
1
|
I have reviewed this Annual Report on Form 10-K of GameStop Corp.;
|
2
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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By:
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/s/ Robert A. Lloyd
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Robert A. Lloyd
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Chief Operating Officer and Chief Financial Officer
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GameStop Corp.
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Shane S. Kim
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Shane S. Kim
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Interim Chief Executive Officer and Director
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GameStop Corp.
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April 2, 2019
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Robert A. Lloyd
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Robert A. Lloyd
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Chief Operating Officer and Chief Financial Officer
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GameStop Corp.
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April 2, 2019
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