Published in Gaming

GameStop falters

by on27 March 2017

Stores shutting 

GameStop is being forced to shutter at least 150 of its 7,500 US stores.

The outfit is seeing increasing worldwide competition and digital sales eating into its bottom line and now the Texas-based retailer announced Thursday it will close 2-3 percent of its store footprint in 2017.

It is planning to open about 100 new locations globally.

GameStop CEO Paul Raines said in a fourth-quarter release the company's non-gaming businesses "drove gross margin expansion and significantly contributed to our profits," but the video game side did not do so well.

He said that the video game category was weak, particularly in the back half of 2016, as the console cycle ages. "Looking at 2017, Technology Brands and Collectibles are expected to generate another year of robust growth, and new hardware innovation in the video game category looks promising."

It is unclear which stores will shut down or exactly when the closures will happen. A GameStop spokesperson told Fortune the process will occur throughout 2017.

GameStop's total global sales for the most recent quarter dropped 13.6 percent to $3.05 billion, while combined comparable store sales declined 16.3 percent.

The Fortune 500 company blamed the dip on "weak sales of certain AAA titles and aggressive console promotions by other retailers on Thanksgiving Day and Black Friday".

Last modified on 27 March 2017
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