Gaming Giant Announces Store Closures Amidst Industry Shift

GameStop's Silent Store Closures Spark Customer and Employee Outrage

GameStop is quietly shutting down numerous US stores, leaving both customers and employees reeling from the unexpected closures and lack of official communication. While GameStop hasn't publicly announced a widespread store closure initiative, social media platforms like Twitter and Reddit are buzzing with reports from affected customers and staff since the beginning of the year.

Once the world's largest physical retailer of new and used video games, GameStop's 44-year history, beginning as Babbage's in 1980, boasts a peak of over 6,000 global locations and $9 billion in annual sales (2015). However, the shift to digital game sales over the past nine years has significantly impacted the company. As of February 2024, ScrapeHero data reveals a nearly one-third reduction in physical stores, leaving approximately 3,000 locations in the US.

Following a December 2024 SEC filing hinting at further store closures, anecdotal evidence from both customers and employees continues to surface online. One Twitter user, @one-big-boss, expressed disappointment over the closure of a seemingly successful local store, fearing this foreshadows the fate of less profitable locations. Employee accounts also highlight concerns, with one Canadian employee citing "ridiculous goals" imposed by upper management during store assessment processes.

The Ongoing Decline of GameStop

The recent wave of closures reflects GameStop's ongoing struggle. A March 2024 Reuters report painted a grim outlook, citing a 287-store closure in the previous year following a nearly 20% (approximately $432 million) revenue drop in the fourth quarter of 2023 compared to 2022.

Over the years, GameStop has attempted various strategies to combat its declining customer base, including expanding into merchandise, phone trade-ins, and collectible card grading. The company also benefited from a significant boost in 2021 thanks to a surge in interest from amateur investors on Reddit, a phenomenon documented in productions like Netflix's "Eat the Rich: The GameStop Saga" and the film "Dumb Money." However, these efforts haven't been enough to prevent the ongoing wave of store closures.