General Gaming News

GameStop has closed another 40 stores in the last two months

GameStop Closing 62 More Stores

As part of the overall global trend of retail struggles, GameStop continues to flounder. With Q1 2020 results coming soon, many analysts are looking at various major retailers in different sectors to judge their viability for the sake of investors. GameStop is one of those companies that has been struggling for quite a while, and it looks like the trend we’re seeing relating to the video game retailer will continue.

As of now, another 40 stores in the US have been closed, or are in the process of closing in March 2020. These stores will all likely be closed by the end of April. The retailer closed around 200 stores last year, all as a part of their efforts to stave off financial ruin. The company has been saddled with billions in total losses over the last several years combined. The net operating costs of the company continue to pile up, and it looks like the company will have to continue shedding locations to remain above water. The previous round of closings nailed another 60 stores to the wall.

As part of these closing, more than a handful of district managers have also been laid off, this is some seriously bad news. A week after Polygon published an extensive report on GameStop‘s internal troubles, more closings and layoffs came crashing onto the scene. The company has been accused of putting huge amounts of pressure on frontline employees to push more upsells. This removal of managers and other leadership

These financial troubles have been noted by investors and creditors, signaling rough financial prospects for the company.

Rating agency Moody’s the company’s debt to “junk”. Moody’s says that GameStop suffers from “sustained competitive threats from downloadable, streaming, and subscription gaming services … during a period of industry weakness.” These issues are further compounded by an overall lack of investor confidence, seen in the ruinous stock prices for GameStop.

The stock is currently trading at just over $3.50, which is even lower than the worst previous low of $4.12. That’s a far cry away from the $11 price point it was trading at just one year ago.

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