In a recent report published by Reuters, it was confirmed that GameStop is making an ‘unspecified number’ of layoffs as the company wrestles with falling share prices and a change in consumer habits. It’s the trend of the day and no video game retailer is safe – in the United Kingdom, the leading retailer – GAME – has made significant cuts, drawbacks, and changes to its operating model.
In the report, it was stressed that GameStop’s leadership team is working hard to trim the fat and cut costs where possible, and in the last year, around 3,000 full-time, salaried employees disappeared from the company’s books.
The End of Bricks and Mortar
For years, traditional video game retailers have seen a substantial decline in on-premises footfall as consumers pivot to digital-based gaming solutions. That’s a sentiment that was echoed in the report published by Reuters today, with a Wedbush Securities analyst explaining:
An increasing mix of digital downloads is hurting physical retail, and there is simply no reason to go to the store if a consumer can just order a game and download it immediately.
This news comes as GameStop’s share price fell by around 16% as the end of the fiscal year draws near. In recent months, GameStop has pulled out of some markets entirely, opting to slash its footprint and regain some lost finances where possible, but year-on-year revenue records continue to fall.
With the rise of online retailers persisting incessantly, there’s little that brick-and-mortar retailers like GameStop can do to beat back the tide.
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