Now during its new earnings Telephone, GameStop Announced that it will be shutting between 180 and 200″under-performing” stores across the world between now and the end of 2019. Despite a fighting year, GameStop claims that of its 5,700 stores globally, 95 percent of them were profitable last year. In other words, it is trimming the fat and shutting the doors of stores that have not been as profitable. And these 180 to 200 closures are just the start of the much larger plan that will see even more closures over the next couple of years.
“While that is an impressive statistic, we have a clear chance To improve our overall profitability by de-densifying our chain,” stated a GameStop representative. We are on track to close between 180 and 200 underperforming stores globally by the end of this fiscal year. And while those closures were more opportunistic, we’re employing a more definitive, analytical strategy, including gain levels and earnings transferability, we anticipate will yield a much larger tranche of closures within the coming 12 to 24 months”
Throughout its last quarter, GameStop posted a net loss of $415 million, Continuing its decline and its diminishing market value. That said, GameStop isn’t anticipating profits anytime soon, however, this could change with the new console generation coming next holiday season.
“We anticipate our year-over-year earnings to be down within the next three years to Four quarters representing the conclusion of [the console] cycle,” added the rep.”Compounding this adverse effect on earnings is the fact that console manufacturers have confirmed the launch sooner than they have previously. We anticipate that this will cause much milder name slate through the remainder of 2019 and ancient 2020 given the end of the cycle timing for consoles.”
GameStop also pointed in a weak holiday line-up this season, which does not Feature a massive game like last year’s holiday line-up failed with Red Dead Redemption 2. According to the game’s company, this will impact its performance as well.