One of the world's largest video game stores has just announced the worst annual figures in decades, raising new questions about the physical health of the video game market, as downloadable games continue to climb. GameStop's net sales fell 3 percent for the 52-week period ending on February 2, a slide that helped cut back modest revenues last year at $ 34.7 million to significant operating losses of $ 673 million. In addition, the company expects sales to fall by another 5-1
The massive loss of GameStop is the largest ever reported by the company and only the third year's loss, as it grew from corporate companies. FuncoLand has recently been in 2000. GameStop last hit a loss in 2012 when it lost almost $ 270 million, partly due to weak holiday sales at the end of the console generation of this era.
But more than the amount, the reason for a new loss may be the long-term concern of thousands of stores around the world. Despite the fact that the hardware sales volume was roughly equal, and the sales of new software dropped by about 4% compared to the previous year, software sales accounted for almost 12% per year, continuing the multi-year slide.
buying low and high sales on used gaming disks in order to encourage business otherwise. But the growth of downloadable games that can not be resold has largely freed the sails from these sails. "We continue to observe a decline in previous software that reflects the decline in the sales of new physical games and the growing demand for digital products," said GameStop COO & CFO Robert Lloyd in earning revenue.
Seeing earlier, when digital proliferation finally reaches a turning point, which makes strong brick and mortar businesses earlier, seems to be largely irrelevant. Tower Records filed for bankruptcy in 2006 after decades of music market leader. Book retailing Borders closed in 2011, the elimination of hundreds of stores, both online and e-book competition has increased.
Gaming retailers may fall into such a turning point as gamers are increasingly downloading games and content they want. EA has been making the majority of its digital marketing sales since 2013 and plans to become a 100% company even longer than that. And in 2017, Activision found that most consoles sales for Destiny 2 came from digital downloads, not from retail drives, setting a new "high watermark" for the company.
GameStop has actually observed an increase in its own sales of digital goods in its stores. This category has grown by 16.5 percent, "due to the constant strength of the digital currency, free game play Fortnite and downloadable content," Lloyd said. Sony's recent decision to stop the sale of digital game codes in retail stores may be detrimental to what's going on
As far as physical goods are concerned, the only real sparkle of GameStop last year was collecting items. This business area has grown by more than 11 percent per year, making 2015 a ThinkGeek store for collectors.
The damage is the last bad sign for GameStop after the company announced that it was unable to find a buyer in January. Earlier this month, GameStop sold its retail mobile phone division of Spring Mobile for $ 700 million, trying to make the remaining company more attractive.
GameStop stocks fell slightly more than four percent in daily trading at the end of Wednesday after a drop of 13 percent earlier. The current stock price of $ 9.78 is the lowest since the beginning of 2005, and well below the peak in 2013, exceeding $ 56 per share