GameStop to Close 180-200 Stores Following Restructuring
During an earnings call, GameStop announced they'll close 180-200 stores by the end of the year.
Following plans of restructuring, GameStop has announced it’ll close 180-200 stores by the end of the year, with more closures planned over the next 12-24 months.
“We are on track to close between 180 and 200 underperforming stores globally by the end of this fiscal year,” says a GameStop representative. “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.”
During GameStop’s earnings call, they also mention of their 5,700 stores, 95% of them are profitable. While that’s an impressive statistic, the representative goes onto say their profits may go down moving forward with the current console generation coming to a close. Additionally, the company is expecting a lighter holiday season this year due to a lack of major blockbusters like Red Dead Redemption 2.
“We expect our year-for-year sales to be down over the next three to four quarters refecting the end of [the console] cycle,” the representative continues. “Compounding this negative impact on sales is the fact that console makers have confirmed the launch earlier than they have in the past. We anticipate 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.”
This news comes after the company announced a restructuring which includes fewer stores with an emphasis on e-sports and retro games. Additionally, GameStop has laid off dozens of employees recently, their CFO resigning and giving up on selling itself to another company.