GameStop's struggles continue, as the physical game retailer announced in yesterday's Q2 earnings call that it would be closing between 180 and 200 stores before the end of the fiscal year.
CFO James Bell says 95% of GameStop's stores, more than 5700 total, were profitable. But those "under-performing" will be on the chopping block as part of the ongoing "Reboot" plan that could lead to even more closures in coming years.
"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," Bell says.
GameStop posted net losses in its Q2 2019 earnings report, showing struggles to regain its footing following significant woes earlier in the year. Just recently, the retailer laid off a number of employees, including Game Informer editorial staff, in order to "reduce costs."
While GameStop plans to renovate stores with new concepts, including esports and retro-themed branches, the "Reboot" initiative is still a work-in-progress for the physical game retailer. Bell also seems to be setting the tone for a lacking 2019, citing a lack of blockbusters like Red Dead Redemption 2 headed into the holiday season; "...we're up against blockbuster titles like Red Dead Redemption 2, 2018's number one volume title, without a comparable launch in 2019," Bell says.
With an increasingly digital marketplace and the rise of subscription services like Xbox Game Pass, times are looking tough for those selling physical copies of games. It's unclear where GameStop will fit in a shrinking marketplace.