GameStop Reveals $673 Million Loss For 2018
Any gamer remotely invested in the gaming industry the past few years is surely aware of all of the changes and technological advancements that have impacted the world of video games. Digital downloads, free-to-play and online shopping have drastically changed how and when players purchase games. Even with this, American gaming’s perennial brick and mortar store, GameStop, still manages to survive. However, not all is well with the retailer, with their stock taking a massive hit after failure to secure a buyer for the company just a few months ago. Now, another blow has faced the company, as a report indicated that GameStop 2018 losses reached $673 million.
As shared by GamesIndustry.biz, GameStop reported a $673 million net loss upon completion of their 2018 fiscal year that ended on February 2nd. This is the biggest yearly loss in the company’s history, which is especially concerning considering that GameStop received a significant amount of cash thanks to the sale of their Spring Mobile retail division. Even with the $700 million earned in this sale, it still was not enough to offset these big losses.
As for all of the other areas of business that GameStop is still in, only collectibles managed to increase sales over the previous year, at an 11% increase. New hardware and software sales were down 1% and 5%, which is understandable considering how long the current iterations of consoles have been out. What especially hit GameStop was a 13% dip in pre-owned and value game sales, which is a big part of GameStop’s profit strategy. GameStop makes substantially more profit off of used game sales rather than new game sales, so it is a clear sign that GameStop may need to rethink their business model.
With more digital games being sold and bigger games providing updates that make gamers want to hold onto their games for longer, pre-owned games might be on the way out. But, GameStop has lasted this long, and it would be hard to imagine that they would ever go down without a fight. Hopefully they don’t pre-order bankruptcy, as enticing as it might end up being in a few years. What do you guys think about the GameStop 2018 losses? Let us know in the comments below!
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Cory Lara962 Posts
A royally radical and totally tubular 90s kid, Cory has a passion for all things nerdy, particularly gaming and nostalgia. While an accountant by day, he strives to be as creative and humorous as possible in his free time, be it here writing on Don't Feed the Gamers, or making dumb satirical posts on his Twitter, Youtube, Facebook and Instagram accounts.