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posted by mrpg on Thursday April 04 2019, @10:37AM   Printer-friendly
from the game-over? dept.

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?


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  • (Score: 2) by VLM on Thursday April 04 2019, @01:57PM (2 children)

    by VLM (445) Subscriber Badge on Thursday April 04 2019, @01:57PM (#824483)

    Interesting pricing idea: There's like 20 amazon locker locations around me already; maybe its already too late; but if p-media is going to Amazon anyway, GS could get a piece of the action by giving up on selling their own stuff and going full on amazon locker provider.

    They could go "gas station convenience store" on add-on sale items. Donno if I want to replace gas station sushi with gamestop sushi as a meme, or pay $5 for an energy drink like at Best Buy, but its an idea of how they could sell extra crap when people pick up their Amazon order. Gamestop sushi; my stomach is turning over just thinking what that would be like. Well, Monster Energy never killed nobody, so there's stuff I'd trust them to sell me.

    Several local CSAs do this kind of partnering with grocery stores; the stores seem to run a net profit off people picking up produce "for free" although you'd think it would be a loss. If the CSA pickup gets them in the store they can sell extra stuff to go along, no problem. Whenever my wife picks up the CSA delivery she would always come home with a bag of stuff to go with it from the store; it does seem to work and seems popular. No obvious reason this couldn't be implemented as a business model at GS.

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  • (Score: 2) by Gaaark on Thursday April 04 2019, @08:36PM (1 child)

    by Gaaark (41) on Thursday April 04 2019, @08:36PM (#824683) Journal

    We did the CSA for a year, but then dropped it: we were getting a lot of stuff like kale and very little of stuff like zucchini and no asparagus. We love zucchini and asparagus and dislike kale, so we ended up buying extra on top. At least picking up our CSA tub at the store would have been handy, lol.

    --
    --- Please remind me if I haven't been civil to you: I'm channeling MDC. ---Gaaark 2.0 ---
    • (Score: 2) by VLM on Friday April 05 2019, @12:03PM

      by VLM (445) Subscriber Badge on Friday April 05 2019, @12:03PM (#824855)

      CSA cooking has definitely been more of an adventure than a business plan; gotta kinda cook with whatever they provide.

      Fun, but its not a "I want a carrot now" "I got a carrot now" service.

      There are CSAs that provide individual items like chickens or eggs and thats obviously different from "a bag of stuff from the farm this week" services.