GameStop Shares Plunge After Poor Q1 Amid Closure Rumours
Mike Sanders / 1 year ago
GameStop Post Poor Q1 Profits
Although it isn’t a brand that is universally known, GameStop is without a doubt one of the biggest video game store companies in America. Over the last few years, however, a clear trend has emerged that has shown that the company is in something of a decline.
Following the latest Q1 report, however, things are not looking any better as in a report via WCCFTech, the company has seen a year-on-year 13% loss and a subsequent huge plunge in the share price. This loss has added further fuel to rumours that the company may be on the verge of collapse.
What Has Gone Wrong?
A key factor in their decline has been the movement of game purchasing to online markets. People are simply less inclined to physically go to a store to buy a game when it can be just as convenient (and often less expensive) to do so online.
There are, however, more than a few former employees of the company who have cited exceptionally poor working conditions and business practices that may ultimately have been driving customers away.
What Do We Think?
GameStop has made it pretty clear that the company is certainly undergoing a transitional period. Specifically, as they look to shift more away from games and more towards the hardware aspects. That being said, however, a 30% share drop in just a 24 hour period is more than a little concerning. Worse, this isn’t even the first time that this has happened in 2019.
It also can’t be ignore just how reliant the brand has been on their 2nd-hand game market which again saw a 10% dip for the period. The short version is, however, that if you do work at GameStop, you might want to start planning your exit strategy and things are not looking likely to improve at any point in the foreseeable future.
What do you think? Can you see GameStop turning this around? – Let us know in the comments!