It’s game over for hundreds of GameStop locations worldwide.
The world’s largest video game retailer announced plans to close 180 to 200 under-performing stores in the U.S. and abroad.
GameStop warned that even more stores could close over the next two years.
“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,” said Jim Bell, the company’s chief financial officer, on a quarterly earnings call with investors on Tuesday as reported by Business Insider.
GameStop currently has about 5,700 locations internationally. They are the world’s largest video game retailer.
However, with so many people buying games digitally today, brick-and-mortar stores like GameStop are less popular destinations than they used to be. Additionally, several popular gaming consoles are at the end of their hardware cycle, which means fewer people are buying them.
GameStop has recorded two straight quarters of double-digit percentage losses. For 2019’s second quarter ending in August, it said its global sales decreased 14.3% to $1.3 billion.
That means that layoffs and closures have been taking place at GameStop locations in an effort to reduce the costs of salaries, advertising, overhead, and other expenses.
“We are committed to acting with a sense of urgency to address the areas of the business that are critical to achieving long-term success and value creation for all our stakeholders,” George Sherman, GameStop’s chief executive officer said in a statement. “We will set GameStop on the correct strategic path and fully leverage our unique position and brand in the video game industry.”
Sherman says the strategy includes finding ways to make the core business more efficient and effective, creating a social and cultural hub of gaming within each store, building up digital capabilities and transforming vendor and partner relationships to keep up with an evolving industry.
There’s no word yet on which locations will be closing their doors or how many employees will be affected.
Story by WXYZ.
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