Dive Brief:
-
GameStop Corp. Thursday reported that Q4 same-stores fell 1.8%, including a 1.4% drop in the U.S. and 2.6% internationally. The retailers also reported a bigger-than-expected drop in revenue.
-
CFO Rob Lloyd said the retailer is projecting slower growth because its previously robust preowned sales are dropping as people are moving to newer equipment and to mobile.
-
The retailer gave a wide range for its projections, saying that Q1 sales may increase 2.5% to 5.5% and fiscal year sales may rise 1% to 6%.
Dive Insight:
GameStop has fought the good fight when it comes to holding steady against online and digital sales, but things may be finally slipping out of its grasp. New consoles are taking a chunk away from its used-game sales, and kids are moving to mobile, a whole different game than when they downloaded games from the web.
This is why the retailer has moved to also sell devices like smartphones and tablets, and why it has bid for a number of RadioShack stores at that retailer’s bankruptcy auction. GameStop CFO said in an interview Thursday that the retailer is also looking at more acquisitions to help it diversify, as well as increasing the number of its Technology Brands stores by 350 to 550 stores this year.