GameStop Suffers Worst Decline in Eight Months on Dim Outlook

The tumble extends a roller-coaster year for GameStop, which faces a decaying core business. With more consumers downloading games on their devices, there’s less need to visit a brick-and-mortar store. But investors have been betting that a suitor, such as a private equity firm, will swoop in and buy the company.

[fluxmulder]

That's pretty bad. I wonder how long before Gamestop calls it quits.

[rainslacker]

I think they're still turning profits overall, but it's hard to keep shares up because it's a declining business model. If they can't keep investors because there isn't enough growth, or can't gain ones because of the same reason, it means their ability to operate diminishes, because they need that investment to buy product to sell.

That's why they were trying so.hard to find more stable ways to make money, because the specialty retail store is pretty much a dying breed nowadays. It's not just games.

[Sirk7x]

Retail in general is just not a good thing to invest in lol. That money could be better invested almost anywhere else.

[Soc5]

Not only is it a struggling business model but it’s also the effect of only trying to make money in the short term and annoying your customer base so much that they eventually leave you in the long term.

[Unspoken]

Who uses GameStop anymore? The world is digital now and we don't have to worry about physical media anymore. Just a few more stragglers begrudgingly holding on to the past.

[UltimateOwnage]

The world is Amazon now. I’d wager that the biggest hit GameStop has taken is more related to online game sales, not digital downloads. I personally don’t want to spend time and money driving to a GameStop to likely not find the product I’m looking for because everyone else wants it too, and then have the employees try to sell me other products when I can go to Amazon, click and it’s here tomorrow.

[KickSpinFilter]

Bestbuy and Amazon destroy GameStop.
Gamestop is going the way of Tweeter
Robbery of your client base only lasts so long

[crazyCoconuts]

I gonna miss having a place to steal off to while my wife shops for boring stuff.

[Newmanator]

Amen cc

[ApocalypseShadow]

Used games should always be an option. But gamestop is trash. The idea of fun, which is what gaming is all about, just doesn't exist there. It's all about profits.

Software etc, Electronic Boutique, Funcoland, Game Crazy, etc were fun before being bought out or their demise from poor leadership. Gamestop just doesn't have a soul. I go there maybe once a year if they have something I can't find anywhere else that I was tracking down online.

And it's still soulless. If they are having trouble, it's because they don't really have what can't be found elsewhere new. Too many places now where you can buy games without being harassed by them for your pocket money. And even being surrounded by games, toys, accessories and video, it's just not enjoyable. And they have demo machines you can't even play or sometimes not even on. And, are they even pushing and demoing vr?

It should be an E3 experience every week or month there with new game releases to sell them. But it isn't.

[CorndogBurglar]

All of this, but also, what's the deal with selling all of those highly overpriced collectibles?

I don't know about you but the Gamestops by me are packed full of worthless stuff no one buys. It just sits there. They have to be losing so much money on all that stuff.

Also, there's 3 separate locations in my town. Two are literally right across the street from each other (one in a strip mall and right across the street in the real mall). The furthest one being only about 10 minutes away from those two in another strip mall. That's gotta be killer overhead and huge waste of money.

The decision makers for GS bust not be very smart business people.

[Rachel_Alucard]

Toys R us went under because they bet all their money on awful pop figures and those crappy skylanders type toys that flood the aisles everywhere. They're trash, they don't sell like they think they do. They are available in too many places so having one collector come to one specific store to buy a specific one is too uncommon for them to be putting that much money into. They think the people who go into gamestop would collect that trash just because it's nerd shit, but it repels most if anything. I go into a game store to buy games, not merchandise.

[gamer7804]

yah sorry, was meaning to reply to the thread above yours.

[ChasingTheSun]

THey also try to sell open games as new, they can burn in h#ll for all i care.

[Muzikguy]

I agree with all this. I don't even go into my local GS. I would on occasion because they've got the largest selection around, but it still doesn't give me much motivation to go. Even with all their games, I know they could have more. They just don't because of all that stupid merch they want to sell now. And I agree too that that stuff turns me off from wanting to go in there. All those figures and Pop boxes just make me think about a store that could be so much better. So I started going to Best Buy to get games and they have a tiny collection in comparison. Now that collection should be bigger too and isn't so it's making me want to just say "forget it" and shop online.

[Sirk7x]

They should honestly go full collectable shop, sell Magic/Pokemon cards and host official tournaments alongside new and retro video games. Some specific comics and graphic novels. Hell, they could probably score exclusive ones. Tabletop gaming and official video game tournaments too. They could get sponsoring easily, and have advertising infrastructure. Perhaps relocate stores. Renting space at malls is very expensive. Tens of thousands or more per month. Rebrand and sell official merch. Get some really good graphic designers to make some cool t-shirt designs that people want to wear. Have friggin 7/11 microwaveable food/snacks to sell to people while they play, and throwback soda (hella tasty). Make it fun, and a place people want to be, so they're likely to spend money while they're there. Put me in charge of Gamestop please.

[gamer7804]

Sorta, some gamestops have great managers and employees while others dont so depending on your location ymmv. The one near me has a great staff and its fun to visit and chat with them. I hope they can make it work.

[CorndogBurglar]

Managers and employees are one thing. I'm talking about the big decision makers of the company. The ones that decide whether to open 3 separate stores withing 10 minute driving distance of each other. The ones deciding that half the store should be filled with overpriced collectibles that don't sell well.

These are not things the managers decide.

[RavageX]

Agreed. As a former employee it's easy to see the company is out of touch. They have a bad habit of throwing random nonsense out to see what sticks. If they would slack off on harassing employees to harass customers the place would be a lot better.

The employees and managers can only do so much when it is the higher ups making all the wrong moves.

[Cobra951]

I'm old enough to remember mom-and-pop shops selling used games for a fraction of the price for new, like $20 for a used copy in good condition of a $50 cartridge game. Then the BS crept in, sweeping away such shops, and replacing them with big-business franchises. The first time I saw a used game selling for only $5 below retail ($55 used, $60 new), I could not believe it. I thought it was a mistake in labeling. Nope. That's when I stopped buying used altogether.

Can't say I'm sorry to see Gamestop flounder.

[PlayableGamez-]

Capitalism is all about profit.

[Sirk7x]

The former EB at my mall used to have monthly gaming tournaments when I was younger. People would be there playing Smash tourneys between the time of the mall closing and midnight releases. I miss that.

[LKane]

Good

[0hMyGandhi]

?

[BuildTheWall]

Fuck the thieving assclowns at Lame Stop!!! , they should've run the business better & thought about not nearly stealing people's games with their low ass trade credit & then turn around & sell the used copy at near the price as a new copy.

[Sirk7x]

It sucks, but I honestly doubt that each store makes a decent amount of profit at all. There's operational overhead and franchise fees that places like Amazon don't have, because they can store and ship so easily. It's hard really for any business to compete with them.

[Cmv38]

Maybe I'll be able to buy them for 7 dollars in store credit.

[CyberSentinel]

👍🏾

[Fist4achin]

Gamestop is still a great place to find games, but their trade values suck. I have a love hate relationship with them as i cant stand buying something "new" and i cant take off the factory plastic, but i would hate to see their stores close because there are no other places with their selection.

[TiredandRetired]

Yea, I worked as an assistant manager with the company a bit over 10 years ago. It really made me cringe to adhere to some of the policies they had in place. Like allowing employees to borrow the brand new games that are "gutted" out of their boxes for display and put into sleeves. Not sure if they still do that, but that was terrible. I bought a brand new game some years after, a collector's edition that was hard to find. It was gutted, and when they put the disc into the box it had a ton of light scratches all over the disc. Brand new. I talked that manager into knocking the price down, only after asking for the District Manager's contact though.

I moved to Europe a number of years ago. They had Gamestop here when I first arrived, but the company completely went out of business shortly after across the entire country where I live. Can't say I miss them. There are some good privately owned indie game shops here. We don't have to worry about Gamestop buying them out now.

[rainslacker]

I just don't buy their new games if they're open. Id rather just take a used version if that's what they're going to sell me. If they don't have it used, I just don't buy it. No reason to hate...although I recognize that it can be inconvenient at times.

[TiredandRetired]

@rainslacker That's fine, unless it's something out of print, which was my case.

[rainslacker]

I think I've only had that happen once, and it was a reduced price and I was going to play the game. They didn't have a used copy, so I just brought it for whatever the price is. But if its a fairly recent game, and they try to charge me $40-60 for it, then I just decline. I know I saw them selling an open collectors edition once for full price, near release date as new, and someone brought it. There is no way I would have done that, even if all the stuff was still there. An open collectors edition is immediately worth less than the MSRP. But that's usually rare for them to do that.

[XxINFERNUSxX]

Forget GameStop and their crap. Digital Press Videogames one of best stores I came across, located in New Jersey I'm in New York and the drive is not to bad. https://www.youtube.com/wat... Ok GameStop top this haha
The owner is also the founder of The Videogame History Museum, probably the biggest in the world. We need more stores like Digital Press Videogames, not GameStop

[ChasingTheSun]

GOOD! Serves them right for ripping us all off for the past 30 years on game and console trade value! They were funcoland at 1st. I buy my games from best buy or amazon and sell my used games on ebay or best buy because they dont rip you off like gamestop has and does. I hate to be negative, but p!$$ on them.

[rainslacker]

Same is happening to all game specialty stores though. It's not just game stop. Their current policies are there because they can't make enough money selling just new games and peripherals.

Love it all you want, but physical gaming is not for retail unless it's a department store which doesn't rely solely on new game sales.

[MadLad]

I've spent $100 there, max, in the better part of a decade. They could go.

[LiamKreptic]

1 dollar cash or 1.25 in store credit is all I can do.

[Skankinruby]

They offer nothing of significance and their prices suck in comparison to larger chain retail stores. Being in the walkway at shopping malls and getting convenient pedestrian business is all that's ever kept them alive.

[TheColbertinator]

I have 4 retro/used shops in my city with both new and classic games that suit my needs. Gamestop is like most brick and mortar in which it refuses to adapt to the new era of online shopping.

Physical copies are cheaper online and go frequently on discount much more than GS

[porkChop]

If you want people to shop in your stores you have to give them a reason to. Why would I go to GameStop/EB when I can usually get games cheaper somewhere else? There's no real value proposition at GameStop anymore.

This GameStop situation reminds me of Blockbuster. BB made dumb decisions, refused to get with the times, and did very little to provide value or convenience to their customers. Now they don't exist anymore.

[Stevonidas]

Seriously, it’s faster for me to visit my local Target than gamestop because the clerk just rings me up. I don’t mind walking a little farther.

[CrimsonWing69]

Good, this is what happens when you’re a greedy and shady business. In the end it’ll catch up and bite you in the ass.

The thing is Gamestop could’ve been great, but their annoying “hound the customer” practices, the gutting of new games selling them as new but also gutting new copies of Xenoblades and selling them as used and hiking the price, and geezus all the other numerous anti-consumer practices they do and did has made me try to steer clear of them for some time.

It’ll be a good day when they go under.

[Fritzwochel]

They do have some decent trade in deals, but I find their customer service so bad I don't want to shop there.

[Sgt_Slaughter]

From Reddit:

"People need to understand this wasn't a cash loss:

"Third quarter fiscal 2018 results include a non-operating, non-cash intangible asset impairment charge of $587.5 million, primarily related to goodwill and triggered by the sustained decline in the company’s share price."

What is an impairment charge?

A impairment charge reduces the company's net worth or book value. The net profit, too, is adversely affected in the year the charge is made. There is no actual cash loss but value is effected. Impairment charges allow corporations to "write off" goodwill assets that no longer carry the same value when previously assessed.

If done correctly, this will provide investors with more valuable information. Balance sheets are bloated with goodwill that resulted from acquisitions during the bubble years, when companies overpaid for assets by buying overpriced stock.

Bottom line: Ever bought something and felt you paid more? Companies sometimes do the same. After investing substantial sums to buy an asset or build it from scratch, they find the asset is worth less than its value in the books.

If an asset doesn’t generate the expected cash flow, the company stands to lose money over the long term. Taking an impairment charge bundles potential losses and front-ends them."

Also the spring mobile sale ($700 million) is not part of Q3, so that hasn't taken effect in the numbers yet.

[Jls1]

I did my black Friday shopping at Gamestop. I got 3 games in plastic brand new Horizon complete $9.99, Shadow of Tomb Raider $27, and cod black ops 4 $38, they had some good deals this year. Maybe they will change their ways.

[-volt-]

Sad for people that may lose their jobs. However, I wouldn't miss them.

[bluefox755]

Screw these guys. I went to Gamestop black friday to get the RDR2 Pro blundle with $50 gift card. Waited in line for 45 minutes to have them tell me they didn't have any, and I was there when it opened. I went home and ordered it from their website. Four days pass without a single order confirmation or delivery confirmation email, nothing from them (to this day). I finally get the Pro, and there is no mention of the gift card in the package, and no email. So I try to call them, but it says it'll be an hour before I can get someone on the line, and I don't have that kind of time. So I emailed them, haven't gotten a reply to this day.

[xRacer74x]

You reap what you sow. I guess gamers got tired of being taken advantage of so they took their business else where.

[spwittbold]

I see literally no point for GameStop to continue existing. It offers next to no value to consumers other than "quick" trade-in services that takes advantage of children and uninformed consumers by taking in their games which those same consumers could get often 2-3x as much for those same trade-ins had they just listed it on eBay or Amazon. Certainly, that can be argued is also the price-for-convenience, but if I can list a game on Amazon in less than 5 minutes for $15 to $20 as opposed to the 2-4$ gamester will give me, I'll gladly list on Amazon and print shipping right from home and have UPS come pick it up at no-charge.

Also, BestBuy,Target, Amazon will all have my games available on release day with promotions as well, so why bother with a such a garbage company?

[Nodoze]

Gamestop is my absolute LAST stop for anything gaming related. Staff always trying to push memberships and preorders, crowded and cramped stores filled with all manner of things NON gaming. Staff clearly does not want to be there and always appear to be engaged in complex purchase scenarios involving people trading in things for new. It just is so so wrong. Gaming is about fun. It is an expensive hobby (like all hobbies) but at it's core it is about fun. Gamestop misses that mark across the board. Sad that yet another store will soon be going out of business, but in this case it will not be missed. As Blockbuster was to late fees for movies, Gamestop is to ripping off consumers with used game prices. GOOD RIDDANCE.

Slightly used Gaming business available for trade in...

[adamwparker]

Is it true that GameStop forces quota commission on their employees?

I heard that they had to sell certain amounts of "offers" to customers at checkout or they were in some ways written up for it.

Anybody here work at GameStop in the past can confirm that?

[DEEBO]

Yes it's true well when I was there it was.

You have to push the pro cards, game trades,game warranty and used games.

They don't make much of new games and consoles but the used stuff is their Cash cow.

So it was like two cards and five pre-orders a shift,you make it good but you don't then your hours are going to be low like one day a week low.
Like the job but hate company ways.
Their earnings report was last Thursday,I knew it was going to miss.
They blame Call of duty and fallout for the drop.

[rainslacker]

They cut your hours if you don't get your numbers. If you do it consistently, then they'll write you up and eventually fire you. Its more of a sales person job like a car dealer than it is a job for minimum wage employees working outside school hours....which is kind of messed up, but if that's what's expected of the employee then they have to do it for their job or they'll find someone who will.

Otoh, it probably cost more to train all these constantly rotating staff than the revenue they make off some of their added sales.

[Mylove1516]

I lost faith in gamestop a long time ago. I see more collectibles and worthless crap at the gamestop in my area taking up most of the stores space. A shop around me called cartridge galore and it was a video game store should be. 5% collectible figure stuff but the rest is video games ranging from PS4 and X1 and Switch all the way back to the Sega Genesis. Shelves upon shelves of video games and systems and accessories for said sytems.

Its at a point that we have 1 gamestop in our area and 3 cartridge galore stores but they are spread out perfectly IMO. I hope when our gamestop goes under that CG takes over the space in our local mall.

[Cikatriz_ESP]

I can’t remember the last time I went to GameStop and they had what I was looking for, and I imagine anyone not in the market for overpriced baubles has had a similar experience.

[SuperbVillain]

I still prfer physical copies but gamestop has been trash for a long time now

[gleepot]

I like GameStop.

[Bobafret]

Gamestop seems about as archaic as Blockbuster to me now.

[PlayableGamez-]

I'm not a big fan of GameStop business practices, but I don't want less and less competition in the sales of gaming merchandise.
If GS falls, I guess Best Buy is my only bet. I don't always want digital games, and I don't only want to shop at Walmart and Amazon. I hope GameStop stays in business,

[DimensionalSound]

It's depressing what a downward spiral this has been. I genuinely hope they work this out and the company starts improving their image. We need brick & mortar game stores.

[Supernintendo85]

That’s what you get. Horrible business practices, treated employees based off of how many subscriptions, reserves, prp’s and warranty’s they got. Some people just don’t want to be bombarded with, “would you like to earn 10% off all used games and accessories? Any games coming out your looking forward to? Just $5 down will reserve you a copy! AND it goes towards the purchase of the game! Would you like to add a 2 year product replacement plan on your game disk or controllers?” Sorry, disgruntled ex employee. I was able to keep up, but i didn’t agree with it so i left. I understand the business model but don’t agree with it. Not surprised they are failing.

[Kumakai]

between amazon and digital sales... no point. i honestly hate going there and it always seems to take forever.

[CyberRekkr]

Well it's because the employee's are mostly assholes, & they try to shove used shit on you after you tell them no. Then they always come back with a smart ass remark,. Like, " if you don't want to save $10 bucks that's you" They try to push preorders on you after you tell them no, there's nothing that I want to preorder. Who the fuck preorders a game that is 6 to 12 months before release?? Not me! They try to act like that there is absolutely no where you can get these games from, but Shitstop! They try to fuck you on your pro points too. Gamestop is a shithole! That's the experience that I have had in 99.9% of the stores I go in.

[chris235]

not the slightest empathy. if they did not check already five years ago to change their business model then this dinosaur has to die. in other words they are not really business savvy. the market does not need such contenders that are stuck in the past *shrugs* sony made sure with their ps+ that such retailers will be pointless. they chose not to react. well, it nobody‘s fault but their own that they are failing. stubbornnes did it again.

[Acecalibur]

I really hate to see brick and game stores die. But, if they go digital maybe they can reinvent themselves.

[Ray186]

If it's digital and the same price as PS and MS Why?