Thank you, George. Good afternoon everyone. I’d like you take this time to walk you through our third quarter fiscal 2020 results, and then I'll share some insights into the success of the new video console launch and how we're approaching the fourth quarter.
As George discuss, we advanced our strategy in the third quarter, making significant progress on our near-term goals of optimizing our core business by reducing expenses, improving our inventory management and strengthening our balance sheet and capital structure. And we did so, while continue to focus on transforming GameStop for the future to deliver profitable long-term growth.
With the third quarter behind us, we're intently focused on maximizing all that the new console cycle has to offer, expanding our foundational work on our elevated omni-channel platform and more efficient operating model. And quickly, but methodically evolving the business to expand our addressable market and support our long-term growth and profit objectives.
As the gaming consumer and industry evolve, we see an opportunity to expand our addressable market, the honor historical predominant focus on the console video game market, with a comprehensive suite of product offerings and new services across all categories for games and entertainment. And simply put, we're making it easier for consumers to find what they need at GameStop in an intuitive, relevant and frictionless shopping experience, all will taking a leadership role across the gaming entertainment categories. Economically, this means adding incremental purchase occasions with higher margin lines of business and therefore capturing greater share of wallet.
Let me turn the review of the third fiscal quarter.
As George mentioned, our third quarter sales performance was as expected as we transition through the final quarter of the Generation 8 console video game cycle, which included the shift of many software titles into the fourth quarter of this year and even in 2021. Further, we realized some top line softness in October as COVID-19 case spike drove retail consumer mobility down.
Our consolidated global sale for the third quarter was $1 billion were 30.2% below the third quarter of 2019. The decline was a combination of the negative 24.6% comparable store sales, the impact of both foreclosures and lower retail customer mobility through most of our operating countries, and the impact of operating 607 fewer stores as part of our strategy to exit unprofitable businesses and optimize our store fleet through de-densification.
We continue to see strong sales and profit transfer rates from that de-densification strategy. Geographically, our Australia and New Zealand business unit continue to perform very well relative to other regions, delivering a slight increase in sales for the quarter. It is important note that performance in this region is driven by very little reduction in store operating days as the COVID related retail operating mandates have generally not required full closure or limited access, except for short periods of time.
In terms of category performance, hardware and accessories declined 24% for the quarter, and expected slight deceleration from the second quarter, largely reflected of a lack of hardware product in the marketplace, ahead of the launch of the new console, much of which was pulled forward into the second quarter. Despite this Nintendo Switch continued to perform extremely well, increasing significantly compared to last year. And we continue to leverage our pre-owned inventory to drive sales.
Software was down 39% for the quarter versus 2019. A deceleration from the second quarter was driven by the lack of title launches, most of which shifted later into the fourth quarter and into 2021. Notably, Call of Duty launched in the third quarter of last year compared to the fourth quarter of this year.
Our collectibles business was down 9% for the quarter, which represents a significant improvement sequentially from the second quarter performance as we realize the benefit of store traffic as stores begin reopening during the quarter after being closed during the second quarter. From product margin standpoint, overall gross margins declined as the increase in the mix of higher margin collectible sales was more than offset by the mix of lower margin hardware sales and an increase in industry-wide freight costs and credit card processing fees driven by our higher penetration of e-commerce sales.
Our overall global gross margins were 27.5%, down 320 basis points from our more software led 30.7 in the fiscal third quarter last year.
Now turning to our expenses and expense management objectives, our reported SG&A expenses were 360 million reflecting a decline of approximately 115 million or 24% versus reported SG&A in the third quarter last year. The total year-to-date SG&A cost reductions reached over 315 million at the end of the third quarter ahead of our expectations.
Importantly, we continue to expect about two-thirds of these reductions to be permanent, reflecting our ongoing efforts to aggressively rationalize the overall cost structure of our business.
While we expect some of these variable costs come back in future quarters, as we return to more normalized operations of our stores and distribution centers.
We are also steadfastly focused on further operational efficiencies to create additional permanent expense reductions in the future. To this end, we have more than doubled the original annual cost reductions we expect it as a result of these actions, we took as part of the Reboot initiative, which began in 2019. We reported an operating loss of $63 million, compared to an operating loss of $45.6 million in the prior year third quarter. Income tax in the third quarter was a benefit of 53.9 million driven by a change in the tax status of certain foreign entities that we've elected and the impact of the CARES Act, which a lot for a five year carry back period for certain current year tax losses. This tax benefit compares to an income tax expense of 31.6 million in the prior year third quarter.
Our effective tax rate for the quarter was 74.1%. On a reported basis, our net loss was $18.8 million, or a loss of $0.29 per diluted share, compared to a net loss of 83.4 million for loss per diluted share $1.02 in the prior year third quarter. Adjusted net loss, excluding the gain on sale of assets related to the sale leaseback transactions with 34.4 million or a loss of $0.53 per diluted share, compared to adjusted net loss of $40.2 million, or $0.49 per diluted share in the fiscal 2019 third quarter.
During the third quarter, we continue to focus on optimizing our global store fleet and strategically identifying certain markets.
For the quarter, we closed a net total of 74 stores bringing our total to 461 closures year-to-date. At the end of the quarter we operated with 5,048 stores or 607 fewer compared to the end of the third quarter last year.
Given the strong sales and profit transfer rates we continue to experience, we are on track to close nearly 700 stores in total this fiscal year and over 1,000 stores worldwide since we began this part of our strategy in 2019.
Importantly, we're completing these closures generally with little to no capital outlay to do so.
Now turning to our balance sheet, which continues to be an area of focus for the team, at the end of the fiscal third quarter, we had total cash and restricted cash of 602.6 million almost 300 million higher than the end of the third quarter last year, reflecting our continued efforts to optimize working capital.
Additionally, during the quarter we completed the sale leaseback transactions to the remaining two office buildings being offered, contributing $43.7 million towards total liquidity. Accounts payable at the quarter end were $44.2 million down from $709.9 million at the end of the third quarter last year, reflecting 38% reduction, which is directly related to our ability to leverage a flexible supply chain and improve our inventory management. We ended the third quarter with total inventory of $861 million compared to 1,286.7 million in the prior year period, a reduction of 33%. Inventory efficiency in the third quarter continue to improve, as we realized the trailing 12 months inventory turn of 4.7 times from 4.1 times this time last year.
During the third quarter, we've reduced outstanding borrowings under the asset based revolving credit facility by about $10 million, down to $25 million outstanding. At the end of the third quarter, we had $269.5 million of short term debt and $216 million of long term debt on the balance sheet. Subsequent to the quarter end, we announced the voluntary early redemption of $125 million in principal amount of our 6.75% senior notes due 2021. The redemption will take place on December 11, 2020 and covers approximately 63% of the outstanding '21 notes. The voluntary early redemption is consistent with our actions to strengthen enhance our balance sheet, improve our depth profile and optimize our capital structure. In the third quarter, we had $15.1 million of capital expenditures and we continue to focus our capital spending on near term high value strategic projects and men for maintenance and still anticipate that we'll invest approximately $60 million to $65 million in CapExfor the year, some of which is offset by our various vendor support programs. Separately today, we also filed a shelf registration statement and established a related optional at the market program to offer and sell up to $100 million of additional common stock.
As I noted several times this year, we're extremely pleased with the results we have achieved to strengthen our balance sheet and advance our strategic objectives. And believe we have more than sufficient liquidity and balance sheet strength to continue to execute on these endeavors, as well as navigate through any potential unknown or extended pandemic effects.
As such, the timing and amount of sales of shares under the program, if any will depend on a variety of factors, including prevailing market conditions, the trading price of shares, and other factors we need to determine.
However, as a pragmatic matter initiating this program provides us with the maximum flexibility and optionality to further bolster our balance sheet and liquidity position and increase flexibility gives us the ability to leverage opportunities to accelerate our transformational strategies, such as increasing the speed at which we elevate expand our omni-channel strategy, while further ensuring minimal disruption from any potential further pandemic impacts around the world.
Before moving to our fourth quarter outlook, I want to spend a few minutes highlighting the initial results of the console launches that occurred in November. By all accounts these consoles are experiencing unprecedented demand, and we continue to work with the suppliers to meet that demand.
Importantly, we continue to be able to achieve attachment rates for first party and third-party software and accessories that are in most cases more than two times that of any other competitor, which is leading to us having opportunities to get additional allocations for these high demand consoles.
Given the strength of our performance so far with the console launch, we expect strong sales growth and profitability in the fourth quarter, something we have not seen in quite a few quarters.
As George mentioned, November comparable store sales increased to 16.5%, despite the impact of foreclosures throughout most of Europe and part of Canada in November.
In addition, our customers continue to respond favorably to our improved e-commerce experience, including our new app and flexibility of new fulfillment and payment options provided within our elevated omni-channel ecosystem.
As a result year-over-year e-commerce sales grew 352% in November versus the same month last year. Despite the strong start the fourth quarter, given the uncertainty around the evolving impact of COVID-19, we are continuing to suspend guidance.
As we mentioned, we have seen varying levels of closures across our international operations, particularly in Europe and as things remain very fluid in the U.S., temporary store closures due to COVID-19 could be likely heading into the rest of December and January. Keep in mind the comparable store sales exclude the impact of permanent store closures and locations close 14 contiguous days or more due to the pandemic.
Before I conclude, I wanted to elaborate a little further on our real estate strategy and efforts to optimize our fleet, especially de-densification over-stored markets and how we're approaching further actions.
Looking at 2019 and 2020 combined, we will have close over 1000 stores over that timeframe with over 300 in 2019 and nearly 720 in 2020, and importantly have spent little to no capital to do so. With our investments improving our omni-channel capabilities, including hiring almost 30 professionals with extensive digital experience coupled with the impact that COVID-19 has had on our customers' desire to experience GameStop across our digital platforms. We've see opportunity to further optimize a fleet in the coming year or two. These efforts come with EBITDA improvement and we have had a very flexible store based in terms of lease expirations. And that will enable us to close stores at very little cost to the business.
We will update you further on these objectives during our fourth quarter and fiscal year-end earnings conference call. In summary, we're off to a great start for holiday, and our associates are energized by the buzz and excitement generated by the console launches.
We have long said that the newness and consoles and software drive our business, and we see that playing out now.
While we are now benefiting from a nice tailwind, we're equally focused on transforming our company for the future and believe we have the right initiatives in place to achieve this goal. Reshaping GameStop for effective market reach and offering a broader range of products and services in a games and entertainment space. In the short term, we will remain intently focused on continuing to improve our financial architecture. But today GameStop is a meaningfully be more efficient streamlined organization than it was 15 months ago, due to all the hard work that our teams have done as part of stabilization and optimization components of our strategy.
As a result, we believe, we're poised to capitalize on significant profit flow through improvement as we experienced sales growth led by both the generation nine console launch and expected new software title slate, as well as the expansion of the transformation phase of our strategy and many exciting category product extensions and services, we will bring into our ecosystem in 2021 and beyond. I will now turn the call over to the operator and we'll take any questions that you may have.