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Sales down 25 percent at close of GameStop's third quarter

Sales down 25 percent at close of GameStop's third quarter

December 10, 2019 | By Alissa McAloon

December 10, 2019 | By Alissa McAloon
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More: Console/PC

Sales across nearly every product category at video game retailer GameStop declined year-over-year, with the once-ailing company’s collectible business once again representing the lone rise in year-over-year sales.

GameStop as a whole reported a net loss of $83.4 million, which is less than the $488.6 million loss the company year prior -- with a couple of caveats.

That GAAP number for the quarter ending November 2, 2019 includes $43 million in impairment charges. GameStop also notes that the previous year's loss included the Spring Mobile business that it has since sold off.

Sales have been on a downturn for a while now at GameStop, and this quarter continues that trend. As a whole, global sales are down 25.7 percent from last year’s $2.1 billion, coming in at $1.4 billion for the quarter.

Looking at it on a category-to-category basis, new hardware sales fell 45.8 percent year-over-year as a new console generation looms on the horizon; new software sales fell 32.6 percent following the previous year’s new-release-boosted strong numbers, while accessory sales fell 13.4 percent and pre-owned sales, including both hardware and software, fell 13.3 percent.

Collectibles, meanwhile, were once again the only category to show a year-over-year increase, though the jump isn’t as strong as the one reported last quarter. Sales of collectibles for the quarter rose 4.3 percent year-over-year thanks to both international and domestic growth.

All of this comes as GameStop continues to endure a brand-wide reboot in an effort to bring the brand back into public, and financial, favor. During the third quarter, that restructuring effort resulted in over 120 layoffs across GameStop as a whole, including half of the editorial staff at the GameStop-owned publication Game Informer.

“Despite the current top-line trends, we are pleased with the continued strong progress that we are making against our strategic initiatives as we transform GameStop for the future,” said a statement from GameStop CEO George Sherman. “We remain on track to achieve our $200 million annualized operating profit improvement goal, by 2021 and we believe our strategic initiatives will enable to us to achieve our long-term growth and profit objectives as we fully leverage our unique leadership position and brand in the video game space.”

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