It would appear that Krampus rolled up to GameStop, stuffed its holiday sales in his sack, and ran away.
In other words, if GameStop was expecting some holiday cheer, the Texas-based retailer of games and collectibles got a steaming heap of coal instead. You get the idea.
Sales at GameStop fell a whopping 27.5% compared to the 2018 season. Comparable same-store sales for the season — the shortest since 2013 — fell 24.7% compared to a 1.5% increase during the previous holiday run. The news follows a downward trend that has been accelerating over the past year, with a 25% decline for the third quarter following a 14.3% drop in the second quarter.
Following some successes in growing its presence in the toys and collectibles space last year and adding a lot of exclusive merch, the downward spiral picked up steam last summer as the company began shuttering its ThinkGeek subsidiary. In the months since, GameStop shuttered its long-running Game Informer magazine, went through rounds of corporate layoffs in August and November, and revealed plans to close as many as 200 of its underperforming stores.
At the same time, GameStop revealed plans to reinvent its stores by entering into a strategic partnership with R/GA — a global innovation and design firm — with a goal of creating “unique in-store experiences” as the company seeks to “re-affirm its place in the video gaming culture.”
Even that might be too little, too late as other players, such as Playlive Nation, have entered the game and are quickly leveling up.
GameStop CEO George Sherman continues to lean on the fact that we’re in the lull before a new console year, but can the arrival of Sony’s Playstation 5 and Microsoft’s Xbox Series X keep the company afloat?