GameStop's Silent Store Closures Spark Customer and Employee Concerns
GameStop is quietly shuttering numerous US stores, leaving both customers and employees reeling from the unexpected closures. The company's decline is starkly evident in the near one-third reduction of its physical presence. Social media platforms are buzzing with customer and employee accounts of these closures, painting a concerning picture for the retailer's future.
The world's largest brick-and-mortar video game retailer, GameStop (formerly Babbage's), boasts a 44-year history. Launched in a Dallas suburb in 1980 with backing from Ross Perot, it reached its zenith in 2015, boasting over 6,000 global locations and $9 billion in annual sales. However, the past nine years have witnessed a significant downturn, largely attributed to the shift towards digital game sales. By February 2024, ScrapeHero data revealed a nearly 33% reduction in GameStop's physical footprint, with approximately 3,000 US stores remaining.
Following a December 2024 SEC filing hinting at further store closures, a wave of reports from both customers and employees flooded social media platforms like Twitter and Reddit. One Twitter user, @one-big-boss, mourned the loss of a beloved local store, highlighting its popularity and expressing concern about the implications for less profitable locations. Employee accounts further underscore the challenges, with one Canadian employee citing "unrealistic targets" amidst the company's store-closure assessments.
GameStop's Shrinking Footprint Continues
The recent spate of closures reflects GameStop's ongoing struggle. A March 2024 Reuters report predicted a grim outlook, citing a 287-store closure in the preceding year, following a nearly 20% (or $432 million) revenue drop in the fourth quarter of 2023 compared to 2022.
Over the years, various internal and external efforts have aimed to revitalize GameStop. In response to the shift to online game purchases, the company has experimented with diverse strategies, including expanding into video game-related merchandise, phone trade-ins, and trading card grading. The 2021 influx of support from Reddit-based amateur investors, documented in Netflix's "Eat the Rich: The GameStop Saga" and the film "Dumb Money," provided a temporary reprieve.
