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GameStop's Silent Store Closures Spark Concern
GameStop is quietly shuttering numerous US stores, leaving customers and employees reeling. The company's decline is starkly evident in the near one-third reduction of its physical footprint. Social media platforms are abuzz with customer and employee accounts of unexpected closures, painting a worrying picture for the retailer's future.
Once the world's largest physical retailer of new and used video games, GameStop's history spans over four decades, originating as Babbage's in 1980. Boasting over 6,000 global locations and $9 billion in annual sales at its peak in 2015, the company has faced a significant downturn in the past nine years. The shift to digital game sales has taken a heavy toll, resulting in a nearly 33% decrease in physical stores by February 2024, leaving approximately 3,000 locations in the US, according to ScrapeHero.
Following a December 2024 SEC filing hinting at further store closures, both customers and employees have taken to platforms like Twitter and Reddit to report closed locations. One Twitter user expressed disappointment over the closure of a seemingly thriving store, fearing this foreshadows the fate of less profitable outlets. Employees have also voiced concerns, with one Canadian worker citing "unrealistic targets" amid the company's store assessment process.
GameStop's Ongoing Store Closures Reflect a Declining Trend
The recent spate of closures continues a downward trend for the struggling retailer. A March 2024 Reuters report predicted a gloomy outlook, citing a 287-store closure in the preceding year and a nearly 20% revenue drop ($432 million) in the fourth quarter of 2023 compared to 2022.
Over the years, GameStop has implemented various strategies to counter its declining customer base and the shift to online gaming. These efforts have included expanding into related merchandise, such as toys and apparel, and venturing into unrelated sectors like phone trade-ins and trading card grading. The company also received a significant boost in 2021 from a surge in amateur investor interest, a phenomenon documented in the Netflix documentary Eat the Rich: The GameStop Saga and the film Dumb Money.
