GameStop Closing 180-200 “Underperforming” Stores By 2020
It has been no secret that GameStop has been going through a bit of a rough patch lately. With the rise of digital storefronts and the likes game subscription services, some people have no interest in going back to physical media, which has caused a bit of a disruption in the industry. That said, it has been revealed that GameStop will be closing around 180 to 200 of its stores by the end of the year as part of their “Reboot” plan.
During a recent earnings call, GameStop CFO James Bell expressed praise for the fact that 95% of the over 5,700 stores in the company were profitable in Q2. However, that isn’t enough to keep everyone afloat. “While that is an impressive statistic, we have a clear opportunity to improve our overall profitability by de-densifying our chain,” Bell said. “That work is well underway. We are on track to close between 180 and 200 underperforming stores globally by the end of this fiscal year. And while these closures were more opportunistic, we are applying a more definitive, analytic approach, including profit levels and sales transferability, that we expect will yield a much larger tranche of closures over the coming 12 to 24 months.”
Bell then went on to say how they expect sales to be down over the next few quarters as the current generation of consoles comes to an end. “Compounding this negative impact on sales is the fact that console makers have confirmed the launch earlier than they have in the past,” he said. “We anticipate that this will lead to much lighter title slate through the rest of 2019 and early 2020 given the end of the cycle timing for current consoles.
“As a result, at this time we expect a percentage decline of comparable same-store sales for 2019 to be in the low teens, which includes a difficult comparable sales challenge from last year, as we’re up against blockbuster titles like Red Dead Redemption 2, 2018’s number one volume title, without a comparable launch in 2019.”
Keep it tuned to Don’t Feed the Gamers as this story develops, and for other gaming goodness going on right now, check out the following:
- New Nintendo Switch Update Adds Alarm Notifications, Online Play Invites Section, And More
- The Walking Dead: The Telltale Definitive Series Is Available Now (VIDEO)
- Co-op Resident Evil Title ‘Project Resistance’ Reveals New Teaser (VIDEO)
What say you, gamers? Are you surprised that GameStop will be closing down that many stores by the end of the year? Sound off in the comments section below, and be sure to follow DFTG on Twitter for live gaming and entertainment news 24/7!