"While 2012 was a challenging year for console gaming, we focused on factors within our control. We expanded our market leadership position, maintained our financial strength and controlled our spending," said CEO Paul Raines in a company statement. "Perhaps most importantly, we invested in our mobile and digital businesses to position the company for future success. These channels delivered as planned and significantly contributed to our highest ever gross margin and profitability."
Short version: Gamestop spent to prepare for the future. The company expects a return to growth with the launch of "at least one next generation console by holiday." There's also the launch of Grand Theft Auto, which was specifically called out as a highlight of this holiday.