GameStop's Quiet Store Closures Shock Customers and Employees
GameStop is quietly closing numerous US stores, leaving customers and employees reeling. The closures, largely unannounced, represent a significant decline for the once-dominant video game retailer. Social media platforms are abuzz with reports from both customers and employees, painting a concerning picture of the company's future.
GameStop, the world's largest physical retailer of new and used video games, boasts a 44-year history, originating as Babbage's in 1980. Reaching its peak in 2015 with over 6,000 global locations and $9 billion in annual sales, the company has faced a dramatic downturn in recent years. The shift to digital game sales has significantly impacted its performance, resulting in a nearly one-third reduction in physical stores since 2015. As of February 2024, approximately 3,000 GameStop stores remain in the US, according to ScrapeHero.
Following a December 2024 SEC filing hinting at further closures, both customers and employees have taken to social media (Twitter and Reddit) to share news of closed locations. Disappointment is widespread, with customers lamenting the loss of convenient, affordable game and console options. Employees, meanwhile, are voicing concerns, citing unrealistic sales targets amidst the company's store consolidation efforts.
The Ongoing Decline of GameStop
The recent closures continue a troubling trend for GameStop. A March 2024 Reuters report predicted a grim outlook, citing a 287-store closure in the previous year and a nearly 20% (approximately $432 million) revenue drop in the fourth quarter of 2023 compared to 2022.
Numerous attempts have been made to revitalize GameStop over the past few years. Facing a shrinking customer base migrating to online purchases, the company has explored diversification, expanding into related merchandise like toys and apparel, and even venturing into unrelated sectors such as phone trade-ins and trading card grading. A 2021 surge in investor interest, fueled by Reddit's amateur investor community, provided a temporary reprieve, a phenomenon documented in Netflix's "Eat the Rich: The GameStop Saga" and the film "Dumb Money." However, the recent wave of store closures suggests the company's struggles persist.
