GameStop's Silent Store Closures Shock Customers and Employees
GameStop is quietly shuttering numerous US stores, leaving both customers and employees reeling from the unexpected closures. The company's decline is undeniable, with its physical footprint shrinking by nearly one-third. Social media platforms are buzzing with customer and employee accounts of store closures, painting a concerning picture of the retailer's future.
The world's largest brick-and-mortar video game retailer, GameStop boasts a history spanning over 44 years, originating as Babbage's. Its first store opened in a Dallas suburb in August 1980, backed by former presidential candidate Ross Perot. By 2015, GameStop reached its zenith, operating over 6,000 stores globally and generating approximately $9 billion in annual sales. However, the past nine years have witnessed a significant downturn, largely attributed to the shift towards digital game sales. As of February 2024, according to ScrapeHero, GameStop's physical store count has plummeted by almost a third, leaving roughly 3,000 locations in the US.
Following a December 2024 SEC filing hinting at further store closures, a wave of social media posts from both customers and employees has surfaced, detailing recently closed or soon-to-be-closed GameStop locations on platforms like Twitter and Reddit. One Twitter user, @one-big-boss, expressed disappointment over the closure of a beloved local store, a frequent source of affordable games and consoles. He noted the store's apparent success, suggesting that even thriving locations are not immune to the closures, foreshadowing a grimmer outlook for less profitable stores. Employee concerns have also emerged, with a Canadian employee citing "ridiculous goals" imposed by upper management as they evaluate store viability.
The Ongoing Closure of GameStop Stores
The recent spate of closures continues a downward trend for the struggling retailer. A March 2024 Reuters report predicted a bleak future for GameStop, highlighting the closure of 287 stores in the preceding year, following a nearly 20 percent (approximately $432 million) revenue drop in the fourth quarter of 2023 compared to the same period in 2022.
Over the past few years, numerous rescue plans have been attempted, both internally and externally. As its customer base migrated to online game purchases, GameStop experimented with various strategies, including expanding into video game-related merchandise and venturing into unrelated sectors such as phone trade-ins and trading card grading. The company received a temporary reprieve in 2021 thanks to a surge of interest from amateur investors on Reddit, a phenomenon chronicled in the Netflix documentary Eat the Rich: The GameStop Saga and the film Dumb Money.
