GME.US shares fell more than 10% after hours! GameStop's Q2 revenue decreased by 31% YoY, and it surprisingly turned a profit

GameStop Corp. (GME.US), the video game retailer, saw its sales decline for a fourth consecutive quarter, but the company managed to post a profit, surprising investors. Data showed that the company's second-quarter revenue fell 31% year-on-year to $798 million, missing the market's expectation of $896 million; net profit was $14.8 million, compared with a loss of $2.8 million a year ago; and earnings per share were $0.01, compared with a loss of $0.09 per share, according to the market's expectation.

GameStop has yet to establish a clear growth strategy as its physical retail business struggles to adapt to the shift from physical discs to software downloads. The company has not held a conference call for several quarters and has not provided financial guidance, leaving investors largely in the dark.

"The company still faces almost insurmountable obstacles in its plan to regain growth," Wedbush analyst Michael Pachter said. The company "lacks completely a strategy to enter new areas with growth potential."

Wedbush rates GameStop "Underperform."