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GameStop Posts Massive Loss as Pre-Owned Game Sales Plummet:
One of the world's biggest video game retailers just announced its worst annual performance in decades, raising renewed questions about the health of the physical video game market as downloadable games continue their ascent. Net sales for GameStop were down 3 percent for the 52-week period ending February 2, a slide that helped flip last year's modest $34.7 million profit to a sizable $673 million operating loss. On top of that, the company expects sales to decline another 5 to 10 percent in the next fiscal year.
GameStop's massive loss is the largest ever reported by the company, and only the third annual loss since it grew out of the corporate remains of FuncoLand in 2000. GameStop last posted a loss in 2012, when it lost nearly $270 million thanks in part to weak holiday sales near the end of that era's console generation.
But more than the amount, the reason behind the new loss could be cause for long-term concern at the retailer's thousands of worldwide storefronts. While hardware sales were roughly flat and new software sales fell about 4 percent year over year, pre-owned software sales cratered nearly 12 percent for the year, continuing a years-long slide.
GameStop has always relied on the high margins of buying low and selling high on used game discs to buoy an otherwise low-margin business. But the rise of downloadable games, which can't be resold, has taken the wind out of those sails to a large extent. "We continue to see declines in pre-owned software, reflecting the decline in sales of new physical games and the increasing demand for digitally offered products," GameStop COO & CFO Robert Lloyd said in an earnings call.
I'm curious how many Soylentils still prefer to buy their games on physical media and who prefers a digital distribution. What's your motivation? Also, what if anything, can Game Stop do so as to continue as a going concern?
(Score: 3, Insightful) by bradley13 on Thursday April 04 2019, @12:06PM (8 children)
I maybe should have added two things:
- First, none of us game on consoles. Why have a console standing around, with inferior hardware, when we all have top-end PCs that we can also use for other things? Consoles make no sense to me...
- Second, what can GameStop do? Serious suggestion: Liquidate early, rather than throwing good money after bad. I cannot see any future for them...
Everyone is somebody else's weirdo.
(Score: 0) by Anonymous Coward on Thursday April 04 2019, @12:21PM (3 children)
I only buy games on physical media, but I could be pursuaded to buy a game without DRM as a ready to burn ISO.
If gamestop want to stay alive selling physical games, they need to focus on the product they are selling. It is not just a game. It is the ownership of a game. It is the extra material. The personal service and chatter over the counter. They also sell game related gadgets and they could turn that up a notch for the nerdy cousy atmosphere. You can't just run a shop like it's an internet shop on-location. It needs to be warm and welcoming. I'd arrange game related events and so on.. come on gamestop you need a community and loyal customers.
(Score: 5, Funny) by VLM on Thursday April 04 2019, @01:52PM (2 children)
That's well intentioned meme advice that doesn't actually work in retail.
"Everyone knows" that "everyone loves" that old fashioned hardware store with old retired tradesmen who actually know what they're doing giving advice on product selection and use. The reality is they all went out of business because actual real world shoppers where the rubber meets the road love saving 25 cents at Home Depot while "interacting" with 17 year old store employees who don't even speak English and don't know which end of the hammer to hold.
When I was a kid I was a minimum wage shelf stocker at a grocery store and we'd have older women ask dumb cooking questions as if a high school boy can handle cooking beyond a TV-dinner level. At the time we laughed at the situation, but in retrospect those chicks were almost certainly MILF cougars looking for action. I guess GS should hire the hottest athletic male employees who can still spell "GTA" in order to lure in the "cool wine aunts" shopping for nephew's bday gifts. Sorta like a Hooters but for middle aged post-wall straight women customers, I guess. The image of younger me, in a tiny speedo, flexing my muscles for some cool wine aunt, while trying to upsell her on extended warranties, is disturbing, clearly I need more caffeine or less or something...
Also gaming is too big of a hobby for even the most devoted employee to have anything useful to say other than trivialities about the top trendiest game of the month, at best. I can read the package and ads as well or better than a retail service drone, but I can get way more info online.
I guess an even more cutting analogy is nobody wants Microsoft Clippy to invade and interfere with their online store, and frankly Clippy would be more intelligent to talk to than most underpaid retail employees.
(Score: 0) by Anonymous Coward on Thursday April 04 2019, @03:40PM
I admire your depressing apathy, but you're wrong.
(Score: 0) by Anonymous Coward on Thursday April 04 2019, @07:00PM
Ahhhh there is the good ol' racism peaking out again. Odd how racists tend to work their fucked up hatred into just about every conversation.
GOOD JOB FUCKWIT!
My guess is you get pegged as an asshole and those 17 year old kids say to themselves "fuck this guy, I NO SPEAKEE ENGLISH!" cause they know you'll assume their brown skin means they are telling the truth.
(Score: 2) by Pino P on Thursday April 04 2019, @03:27PM
Among the talking points of the console proletariat [pineight.com] are these:
(Score: 1, Interesting) by Anonymous Coward on Thursday April 04 2019, @04:06PM (1 child)
Well, they could perhaps try to make a strong effort to actually make it a nice experience to go there for customers for starters.
Second, they could perhaps try to stop gutting games (pre-opening them to put the box out on the shelf) then selling that as "new" - this is especially the case for limited edition games or games that include one use DLC coupons since fuck all knows if a store clerk used it on you. (Most likely won't but all you need is one bad apple to make headlines.)
Third they could perhaps sell their used games with used prices - this 5 dollars off the new price is nuts and most people realize that. Especially when there are times when new copies of the game end up being dropped in price to liquidate - lower than the used price tag. I've seen several cases when I'd see the used game going for 28 bucks or so and the "new" (gutted most of the time) copy would be down to 19 bucks.
However the console market itself is trying hard to make the physical copies as unattractive as possible, so that just makes gamestop's job all the harder. Nowadays you're lucky you get anything beyond the disc. And I've seen several "Special editions" get labeled as such simply because they have a small manual included - and in some cases where the only special thing about it being a special cover wrapped over the case. Still nothing but the disc being actually bought.
(Score: 0) by Anonymous Coward on Thursday April 04 2019, @07:03PM
Yeah, like making a game require an update even though you did NOT connect the console to the internet. How exactly does that work? The game demands an internet connection so it can do shit before ALLOWING you to play?
Fuck it, I'm done with the AAA titles that are so very rarely worth the time anyway. There are so many games now I can easily choose to only support the decent ecosystems that don't treat users like shit.
(Score: 0) by Anonymous Coward on Friday April 05 2019, @01:39PM
I found a use for consoles. In games where you just can't play without drm and do want to try it, and I am looking at you Fortnite, a machine with no personal info that is rooted anyway will do. I have a PS4 now. Most games are quite cheap. This "pay to play online" pisses me off to the point where I think I should have gotten a ps3 but I will figure out a way to access PSN without giving away my credit card or personal details.
It's nice to be able to stick in a disk and just play. It's a pity the future consoles will likely do away with disks so the game companies can screw people over the Microsoft way of "we don't support that anymore! Your content will be deleted!"