GameStop to close 200 stores
Video game retailer has not identified which locations it plans to shut
It’s game over for hundreds of GameStop locations nationwide.
The retail chain headquartered in Grapevine, Texas, is planning to close up to 200 underperforming stores following a lackluster secondquarter report.
“Over the last couple of months, we implemented changes that require us to make tough, but necessary decisions for the benefit of our organization moving forward,” said GameStop CEO George Sherman in a Tuesday earnings conference call that reported a 14.3 percent dip in global sales for the company.
Where the closures will occur have not been released by the video game retailer, but GameStop operates more than 5,700 stores across 14 countries.
The company reported revenue of $1.29 billion last quarter, down from $1.5 billion in the same period last year.
Sherman said during the conference call that shuttering underperforming locations was part of an effort to course correct. An increasing number of gamers are opting to buy their video games online instead of at retail stores.
Last year, the United State’s gaming industry recorded total video game sales exceeding $43.4 billion, according to the Entertainment Software Association, a game industry trade organization. The majority of that revenue came from online purchases which accounted for 83 percent of sales while the remaining balance came in the form of physical format sales.
GameStop has closed 195 stores since last year, which Sherman said has been part of efforts to “rightsize the organization across our corporate infrastructure and our U.S. store leadership organization.”
With closures on the horizon, Sherman also said GameStop executives are pushing to develop a social and cultural hub of gam
ing within each remaining GameStop store to account for shifting consumer trends.
Sherman said the new strategy could include a 12day “trybeforeyoubuy experience,” eSportsfocused
comparative gaming content delivery and more.
Retailers, particularly in shopping malls, have had a rough year with several companies contemplating or seeking bankruptcy.
National reports predicted last month that the women’s clothing store chain Forever 21 would file for bankruptcy,
following suit with brands like Payless, Charlotte Russe and Gymboree Group, which all filed in the winter.
While many attribute ongoing bankruptcy filings to a “retail apocolypse,” the National Retail Federation said the worries are exaggerated.
There were almost 3,100 more stores during the fourth
quarter of 2018 than the same quarter a year earlier, according to Census Bureau data reported by the NRF.
The same NRF data found that more stores opened than closed for each segment of the retail industry.