While new software sales grew 9.4%, used product sales increased 19.4% during the quarter. However, comparable store sales dropped 7.8% due to a decline in new video game hardware sales. New video game hardware sales fell 2%. The company opened 86 stores during the quarter, including 48 in the U.S.

Gross margin increased 60 basis points year-over-year to 28.5% in the reported quarter. The margin improvement was a result of product mix shift from low-margin hardware sales to higher-margin software sales.

GameStop reiterated fourth quarter earnings guidance in the range of $1.47 to $1.65 per share, compared to $1.39 in the prior-year quarter. The company expects comparable store sales in the range of -7.0% to -1.0%.

For the full year, GameStop forecasts EPS of $2.45-$2.63, which reflects year-over-year EPS growth of 2% to 10%. Comparable store sales are expected to decline between 7.0% and 4.0% for the year.

The company continues to generate significant cash flow, utilizing it for opening new stores and acquisitions. For fiscal year 2009, GameStop expects to generate free cash flow in the range of $400 million to $425 million.

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Total company sales in the quarter were $1.83 billion, an 8.2% increase as compared to sales of $1.70 billion in the prior year quarter. New software sales grew 9.4%, advancing our new video game market share by 150 basis points over last year. Used product sales increased 19.4%, on top of the 19.3% increase in the third quarter of 2008. Comparable store sales decreased 7.8%, attributable primarily to a decline in new video game hardware sales.

The top five selling games during the quarter were Electronic Arts' Madden NFL 10, Microsoft's Halo 3: ODST, Warner Home Video Games' Batman: Arkham Asylum, 2K Sports' NBA 2K10 and Nintendo's Wii Sports Resort. Each of these new games was well received by consumers and met or exceeded our initial sales expectations.

Net earnings for the quarter were $52.2 million, including $2.5 million of debt retirement costs ($1.6 million net of tax benefits). This represents an 11.8% increase as compared to net earnings of $46.7 million in the prior year period, including merger-related costs of $16.6 million ($10.5 million net of tax benefits). Diluted earnings per share were $0.31, including $0.01 of debt retirement cost, compared to $0.28 in the prior year quarter, including merger-related costs of $0.06 per diluted share.

Daniel DeMatteo, GameStop Chief Executive Officer, stated, "A sharp focus on efficient operations in this challenging global economy delivered solid earnings results and significant market share gains. Gross margins expanded, led by a sequential 150 basis point improvement in the used category. Store foot traffic increased from the prior quarter, driven by strong new title releases and price cuts on all current generation platforms.

"The holiday season has started strong. In the first 72 hours of its release, GameStop sold over 2.5 million copies worldwide of Call of Duty: Modern Warfare 2. We are optimistic that the huge success of this game will serve as a bellwether for what we can expect for the remainder of our holiday game sales.

"We know consumers are looking for value in these difficult economic times. Our stores are prepared to deliver this holiday with the broadest selection of new and used games, the most knowledgeable gaming associates and the buy-sell-trade model, which offers affordable choices that meet the needs of all types of gaming customers."

Updated Guidance

Based on strong initial results of the new software titles released earlier this month, such as Call of Duty: Modern Warfare 2 from Activision, New Super Mario Bros. from Nintendo and Ubisoft's Assassin's Creed 2, we expect a solid fourth quarter in sales and earnings.

For the fourth quarter of fiscal 2009, GameStop is reaffirming guidance of diluted earnings per share to range from $1.47 to $1.65, as compared to $1.39 in the prior year period. Comparable store sales are projected to range from -7.0% to -1.0%.

Full year diluted earnings per share are forecast to range from $2.45 to $2.63, representing annual EPS growth of +2% to +10%. Comparable store sales are projected to range from -7.0% to -4.0% for the full year.

Note that guidance does not include debt retirement costs or merger-related expenses.

Conference Call and Webcast Information

A conference call with GameStop Corp.'s management is scheduled for November 19, 2009 at 11:00 AM ET to discuss the third quarter sales and earnings results. The conference call will be simulcast on the Internet at http://investor.gamestop.com. The conference call will be archived on the website until December 3, 2009.

About GameStop

Headquartered in Grapevine, TX, GameStop Corp., a Fortune 500 and S&P 500 company, is the world's largest video game and entertainment software retailer. The company operates 6,391 retail stores in 17 countries worldwide. The company also operates an e-commerce site, GameStop.com, and publishes Game Informer(R) magazine, a leading multi-platform video game publication. GameStop Corp. sells new and used video game software, hardware and accessories for video game systems from Sony, Nintendo, and Microsoft. In addition, the company sells PC entertainment software, related accessories and other merchandise. General information on GameStop Corp. can be obtained at the company's corporate website: http://www.gamestopcorp.com.

Safe Harbor

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, the outlook for the fourth quarter and fiscal year 2009, future financial and operating results, the company's plans, objectives, expectations and intentions, and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of GameStop's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. GameStop undertakes no obligation to publicly update or revise any forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the inability to obtain sufficient quantities of product to meet consumer demand; the timing of release of video game titles for next generation consoles; the risks associated with expanded international operations and the integration of recent acquisitions, including Micromania; the impact of increased competition and changing technology in the video game industry; and economic and other events that could reduce or impact consumer demand. Additional factors that could cause GameStop's results to differ materially from those described in the forward-looking statements can be found in GameStop's Annual Report on Form 10-K for the fiscal year ended January 31, 2009, filed with the SEC and available at the SEC's Internet site at http://www.sec.gov or http://investor.gamestop.com.

GameStop Corp.
Statements of Operations
(in thousands, except per share data)
                                     13 weeks             13 weeks
                                     ended                ended
                                     Oct. 31, 2009        Nov. 1, 2008
Sales                                $    1,834,727       $    1,695,746
Cost of sales                             1,311,643            1,222,317
Gross profit                              523,084              473,429
Selling, general and administrative
expenses                                  391,210              335,722
Depreciation and amortization             41,605               35,767
Merger-related expenses                   0                    16,605
Operating earnings                        90,269               85,335
Interest expense, net                     10,466               8,807
Debt extinguishment expense               2,461                0
Earnings before income
tax expense                               77,342               76,528
Income tax expense                        25,117               29,859
Net earnings                         $    52,225          $    46,669
Earnings per common share:
Basic                                $    0.32            $    0.29
Diluted                              $    0.31            $    0.28
Weighted average common shares
outstanding:
Basic                                     164,702              163,736
Diluted                                   168,113              167,995
Percentage of Sales:
Sales                                     100.0     %          100.0     %
Cost of sales                             71.5      %          72.1      %
Gross profit                              28.5      %          27.9      %
SG&A expenses                             21.3      %          19.8      %
Depreciation and amortization             2.3       %          2.1       %
Merger-related expenses                   0.0       %          1.0       %
Operating earnings                        4.9       %          5.0       %
Interest expense, net                     0.6       %          0.5       %
Debt extinguishment expense               0.1       %          0.0       %
Earnings before income
tax expense                               4.2       %          4.5       %
Income tax expense   1.4 %   1.7 %
Net earnings         2.8 %   2.8 %

GameStop Corp.
Statements of Operations
(in thousands, except per share data)
                                     39 weeks             39 weeks
                                     ended                ended
                                     Oct. 31, 2009        Nov. 1, 2008
Sales                                $    5,553,984       $    5,313,783
Cost of sales                             3,993,381            3,882,825
Gross profit                              1,560,603            1,430,958
Selling, general and administrative
expenses                                  1,151,815            1,012,134
Depreciation and amortization             119,109              106,912
Merger-related expenses                   0                    16,605
Operating earnings                        289,679              295,307
Interest expense, net                     33,422               26,506
Debt extinguishment expense               5,323                2,331
Earnings before income
tax expense                               250,934              266,470
Income tax expense                        89,591               100,513
Net earnings                         $    161,343         $    165,957
Earnings per common share:
Basic                                $    0.98            $    1.02
Diluted                              $    0.96            $    0.99
Weighted average common shares
outstanding:
Basic                                     164,604              162,983
Diluted                                   167,981              167,813
Percentage of Sales:
Sales                                     100.0     %          100.0     %
Cost of sales                             71.9      %          73.1      %
Gross profit                              28.1      %          26.9      %
SG&A expenses                             20.7      %          19.0      %
Depreciation and amortization             2.2       %          2.0       %
Meger-related expenses                    0.0       %          0.3       %
Operating earnings                        5.2       %          5.6       %
Interest expense, net                     0.6       %          0.5       %
Debt extinguishment expense               0.1       %          0.1       %
Earnings before income
tax expense                               4.5       %          5.0       %
Income tax expense   1.6 %   1.9 %
Net earnings         2.9 %   3.1 %

GameStop Corp.
Balance Sheets
(in thousands, except per share data)
                                                                    Oct. 31,        Nov. 1,
                                                                    2009            2008
ASSETS:
Current assets:
Cash and cash equivalents                                           $    292,027    $    478,056
Receivables, net                                                         52,543          50,730
Merchandise inventories                                                  1,733,962       1,424,249
Prepaid expenses and other current assets                                91,059          170,671
Deferred taxes                                                           24,503          29,200
Total current assets                                                     2,194,094       2,152,906
Property and equipment:
Land                                                                     11,819          10,229
Buildings & leasehold improvements                                       516,492         404,660
Fixtures and equipment                                                   692,660         590,565
                                                                         1,220,971       1,005,454
Less accumulated depreciation and amortization                           629,276         502,348
Net property and equipment                                               591,695         503,106
Goodwill, net                                                            1,931,672       1,443,782
Other noncurrent assets                                                  318,547         63,907
Total assets                                                        $    5,036,008  $    4,163,701
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable                                                    $    1,328,041  $    1,102,639
Accrued liabilities                                                      510,296         366,147
Total current liabilities                                                1,838,337       1,468,786
Other long-term liabilities                                              111,127         85,273
Senior notes payable, net of discount                                    447,121         545,462
Total liabilities                                                        2,396,585       2,099,521
Stockholders' equity:
Preferred stock - authorized 5,000 shares; no shares
issued or outstanding                                                    --              --
Class A common stock - $.001 par value; authorized 300,000 shares;
164,752 and 163,776 shares issued and outstanding, respectively          165             164
Additional paid-in-capital                                               1,334,481       1,299,721
Accumulated other comprehensive income (loss)                            122,944         (23,870   )
Retained earnings                                                        1,181,833       788,165
Total stockholders' equity                                               2,639,423       2,064,180
Total liabilities and stockholders' equity                          $    5,036,008  $    4,163,701

Schedule I
GameStop Corp.
Sales Mix
                             13 Weeks Ended           13 Weeks Ended
                             Oct. 31, 2009            Nov. 1, 2008
                                          Percent                  Percent
                             Sales        of Total    Sales        of Total
Sales (in millions):
New video game hardware      $   321.4    17.5  %     $   328.4    19.3  %
New video game software          769.4    41.9  %         703.3    41.5  %
Used video game products         507.7    27.7  %         425.1    25.1  %
Other                            236.2    12.9  %         238.9    14.1  %
Total                        $   1,834.7  100.0 %     $   1,695.7  100.0 %
Schedule II
GameStop Corp.
Gross Profit Mix
                             13 Weeks Ended           13 Weeks Ended
                             Oct. 31, 2009            Nov. 1, 2008
                                          Gross                    Gross
                             Gross        Profit      Gross        Profit
                             Profit       Percent     Profit       Percent
Gross Profit (in millions):
New video game hardware      $   26.8     8.3   %     $   25.4     7.7   %
New video game software          173.8    22.6  %         158.5    22.5  %
Used video game products         240.0    47.3  %         204.8    48.2  %
Other                            82.5     34.9  %         84.7     35.5  %
Total                        $   523.1    28.5  %     $   473.4    27.9  %

SOURCE: GameStop Corp.

Media Contact: 
Chris Olivera 
Vice President, 
Corporate Communications 
GameStop Corp. 
(817) 424-2130 
or 
Investor Contact: 
Matt Hodges 
Director, 
Investor Relations 
GameStop Corp. 
(817) 424-2130