Guitar Center 8-K Management Operating Model for Remainder of 2005

Exhibit 99.1

Guitar Center, Inc.

Management Operating Model for Remainder of 2005

As of May 12, 2005

(in thousands, except per share amounts)

							2005
Guitar Center Retail	Q2		Q3		Q4		Year
Net sales
Bottom end of range	293,570		305,871		404,783		1,298,867
Top end of range	299,189		311,581		411,783		1,317,196
Comp store sales increase
Bottom end of range	5	%	5	%	4	%	5	%
Top end of range	7	%	7	%	6	%	7	%
Operating income %
Bottom end of range	6.0	%	5.4	%	10.4	%	7.3	%
Top end of range	6.3	%	5.8	%	10.7	%	7.5	%
Music & Arts Retail
(Formerly American Music)
Net sales
Bottom end of range	24,088		32,072		35,599		101,997
Top end of range	26,088		34,072		38,099		108,497
Comp store sales increase
Bottom end of range	3	%	3	%	3	%	3	%
Top end of range	5	%	5	%	5	%	5	%
Operating income %
Bottom end of range	-20.3	%	1.2	%	3.7	%	-4.4	%
Top end of range	-17.0	%	1.9	%	4.4	%	-3.2	%
Direct Response
Net sales
Bottom end of range	78,033		85,109		114,515		369,162
Top end of range	81,218		88,583		119,045		380,351
Operating income %
Bottom end of range	8.6	%	7.7	%	11.7	%	9.9	%
Top end of range	9.0	%	8.1	%	12.1	%	10.2	%
Consolidated Company
Net sales
Bottom end of range	395,691		423,052		554,897		1,770,026
Top end of range	406,415		434,236		568,927		1,805,964
Operating income %
Bottom end of range	4.9	%	5.6	%	10.3	%	7.2	%
Top end of range	5.4	%	5.9	%	10.5	%	7.4	%
Interest Expense
Bottom end of range	1,500		1,650		1,550		5,575
Top end of range	1,600		1,850		1,650		5,975
Net Earnings
Bottom end of range	10,993		13,485		34,096		74,458
Top end of range	12,410		14,728		35,910		78,931
Diluted weighted average shares outstanding	29,774		29,824		29,892		29,892
EPS (1)
Bottom end of range	0.39		0.48		1.16		2.59
Top end of range	0.44		0.52		1.23		2.74
One time charges related to the Music & Arts acquisiton (2)
Bottom end of range	3,400		200		—		3,600
Top end of range	3,550		250		50		3,850
EPS impact per diluted share	0.07		—		—		0.08
Capital Expenditure
Bottom end of range	17,500		14,000		5,500		59,881
Top end of range	19,000		15,000		6,500		63,381

(1) None of the earnings or EPS calculations provided include the cost of expensing stock options.  Any such cost would reduce earnings and EPS.

(2) The charges related to the Music & Arts Center acquisition resulted primarily from the elimination of a redundant point of sales system, severance costs, and moving expenses to relocate certain American Music employees to the Music & Arts Center corporate office in Frederick, Maryland.

Guitar Center, Inc

Management Operating Model for Remainder of 2005

As of May 12, 2005

(in thousands, except per share amounts)

Calculation of diluted earnings per share under GAAP (1)

				2005
	Q2	Q3	Q4	Year
Bottom end of range
Net income	10,993	13,485	34,096	74,458
Add back interest, net of tax on 4% Senior Convertible Notes	727	727	727	2,908
Net income excluding interest expense on 4% Senior Convertible Notes	11,720	14,212	34,823	77,366
Diluted weighted average shares outstanding excluding shares on 4% Senior Convertible Notes	26,882	26,932	27,000	27,000
Incremental shares on assumed conversion of 4% Senior Convertible Notes	2,892	2,892	2,892	2,892
Diluted weighted average shares outstanding	29,774	29,824	29,892	29,892
Diluted net income per share	0.39	0.48	1.16	2.59
Top end of range
Net income	12,410	14,728	35,910	78,931
Add back interest, net of tax on 4% Senior Convertible Notes	727	727	727	2,908
Net income excluding interest expense on 4% Senior Convertible Notes	13,137	15,455	36,637	81,839
Diluted weighted average shares outstanding excluding shares on 4% Senior Convertible Notes	26,882	26,932	27,000	27,000
Incremental shares on assumed conversion of 4% Senior Convertible Notes	2,892	2,892	2,892	2,892
Diluted weighted average shares outstanding	29,774	29,824	29,892	29,892
Diluted net income per share	0.44	0.52	1.23	2.74

(1) None of the earnings or EPS calculations provided include the cost of expensing stock options. Any such cost would reduce earnings and EPS.