Analysts are predicting around 4m PS 4 VR sets sold by end of 2016. With supply constraints being the biggest problem. Gamestop just listed a $499 set for preorder a couple of days ago. The VR game comes with a DISC. They should at least have a feel of the demand and what their supply allocation will be. Hopefully they will at least get 40%. VR imo will be like guitar hero and the wii in where the non video game consumer will be enticed by this new product and buy it.
The second story that I never see in any news articles is the Tech brand growth from around 218 stores at the end of 2013 to 481 in 2014 and 1034 as of Holidays 2015. Sales should come in around $650m for the year. Should they have acquired the 500 new stores which I think they will they are on their way for the fourth year of over 100% growth in stores. They will also have over $1b in rev from tech brands alone.
With VR and tech brands they need to get more PR out that they are not a dead blockbuster.
Management needs to drive home their growth plan. The multiple on this stock is ridiculously low because the street doesn't believe there is any growth. This call needs to address this.
1. VR is going to be huge. This is where bricks and mortar should shine because they have to tell a story to the customer with experiences. Something that online can not do. What is there VR plan this has to be addressed.
2. Tech Brand growth what is the plan? Did they acquire more At&T stores. They need to highlight these as individual businesses. Instead of throwing Kongregate, Simply Mac, Cricket, and spring mobile together.
3. They probably wont announce anything but they should hint toward what Nintendo is doing. The rumor being that they are releasing a new console for the 2016 Christmas season. Also there are rumors that Sony is releasing a PS4.5 with 4k abilities and better VR components.
4. Think Geek this brand could be huge. There alot of synergies with this brand and gamestop. They could easily be at 100 stores by the 2016 holiday shopping season.