In an effort to drive its Technology Brands segment revenue higher, GameStop Corp.GME has completed the acquisition of AT&T, Inc.'s T authorized retailers - Cellular World Corp., Midwest Cellular as well as Red Skye Wireless. Following the acquisition of these AT&T's authorized retailers, the company has added 507 more stores to its Technology Brand portfolio. However, the financial terms of the deal have been kept under wraps.
Post buyout, GameStop has become AT&T's chief authorized retailer with 1,421 AT&T Mobility stores. Cricket Wireless is a new AT&T brand that offers pre-paid wireless services, devices and related accessories. The company operates 70 Cricket Wireless outlets in the U.S. Moreover, the service is offered in 3,400 of its U.S. GameStop locations.
The collaboration with AT&T and Apple has proved to be lucrative for GameStop. In first-quarter fiscal 2016, the Technology Brands segment's revenues surged 62.2% year over year. Further, the segment is expected to sustain its growth momentum as the company is keen on rapidly expanding its footprint by opening more stores.
GAMESTOP CORP Price
Earlier, GameStop had mentioned that it expects the Technology brands segment to generate over $1.4 billion in revenues and nearly $170 million in operating income by the end of 2019. However, following the acquisitions, this Zacks Rank #1 (Strong Buy) company expects Technology Brands to garner $200 million of operating earnings and $1.6 billion in revenue by the end of 2019.
The company said that it will disclose further more information about the acquisitions when the company will report its second-quarter earnings on Aug 25.
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