In response to declining sales, GameStop announces plans to close “more stores than we have closed in recent years”

GameStop has announced that due to a company-wide decline in sales, it may soon begin a mass closure of its physical stores.

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The video game retailer turned Funko Pop! warehouse first revealed its current struggles in its second-quarter 2024 financial report, released Sept. 12.

GameStop revealed that compared to the same period last year, its net sales for the second quarter fell from $1.164 billion to $0.798 billion, a decrease of about 30%.

In light of this result, the company subsequently announced that it had “initiated a comprehensive store portfolio optimization study that involves identifying stores for closure based on a number of factors, including an assessment of current market conditions and individual store performance.”

“While this review is ongoing and no specific set of stores has been identified for closure, we anticipate that it may result in the closure of a greater number of stores than we have closed in recent years,” they added.

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Unfortunately for the retail chain, this “closure consideration” comes about four years after their previous announcement, made by former CEO George Sherman during their Q4 2019 earnings call, that they would “densify (a corporate term meaning “consolidate”) our global store base and anticipate store closures equal to or greater than the 320 net closures we saw in fiscal 2019 globally.”

Notably, following this previous reduction, GameStop closed all of its physical stores in Ireland, Switzerland and Australia.

Interestingly, these cancellation warnings come just days after the retailer announced plans to launch a new “retro program,” which will see classic consoles and games once again offered for sale at a select number of GameStop stores.

To that end, it remains to be seen how – and ultimately if – these two plans will work together.

As of this writing, GameStop has yet to publicly detail what specific areas or stores they are currently considering for “densification.”

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This article was mentioned: Gamestop

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