Video game retailer GameStop's fourth-qtr earnings miss estimates

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GameStop, the world's biggest retailer of video game products, reported lower-than-expected quarterly earnings, hurt by fewer game releases and a drop in store traffic.

The company, which is also facing a growing preference for lower-priced offerings available on smartphones and tablets, said it would close about 2 percent of its stores this year.

Console gamers are also buying more games online.

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GameStop shares fell 6.4 percent to $36.47 in early trading.

Net profit fell to $220.5 million, or $1.89 per share in the fourth quarter ended Feb. 1 from $261.1 million, or $2.15 per share, a year earlier.

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Revenue rose to $3.68 billion from $3.56 billion, helped mainly by demand for new game consoles from Sony and Microsoft.

Analysts had expected earnings of $1.92 per share on revenue of $3.79 billion, according to Thomson Reuters I/B/E/S.

The Grapevine, Texas-based company said in January that sales of games for older versions of Xbox and PlayStation consoles were sagging.

GameStop's used-game business, historically its most profitable, is facing new competition from retailers such as Wal-Mart Stores, which said this month it would allow U.S. shoppers to trade in used games for anything from groceries to gadgets.

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Sony also plans to launch a service to sell older games online.

By Reuters