Gamers, look away!
Unfortunately, GameStop has announced that it will be closing more of its brick-and-mortar stores next year. Earnings Report.
The company said it was struggling to sell hardware in stores around the world as more games were downloaded digitally rather than just ordered online.
The next closure is More dramatic That's larger than the contraction the company experienced last year.
The once-storied retailer closed 287 stores worldwide in the 12 months to March this year.
The closures will leave the total number of stores standing at just 4,000, a number that is set to shrink further. The company has not disclosed how many stores it plans to close, but it is expected to be a significant number.
GME shares fell sharply following its earnings report released on Wednesday. 15% loss in one dayThe company's shares have fallen 7% over the past month.
The latest reports are a far cry from the height of the meme stock boom, when GME shares soared on the back of motivated retail investors.
GameStop stock has become a morality war pitting individual investors against the overwhelming power of institutional investors.
GME shares soared in 2021 as low-level day traders put pressure on institutional investors with short positions.
This began the era of meme stocks and meme coins: financial investments made not based on the soundness of an asset, but as part of a pool of interested amateur investors.
Earlier this year, internet icon Roaring Kitty, one of GME's champions, returned to X to try and revive the stock wars.
When news broke that Roaring Kitty was back on the market and “hodling” (internet slang for “holding on for dear life”), the stock price soared 119%.
However, that surge in stock prices was short-lived, and the company's stock price rapidly declined back to its baseline.
Now, as GameStop continues its downward trend, those golden days seem like a distant memory.
Revenue for the quarter ended Aug. 3 was $798.3 million, up from $1.16 billion in the same period last year.
GameStop shares are up 18.5% since the beginning of the year, but analysts like Jim Cramer $20 stock price is too high.
Executives said they hope closing underperforming stores will help streamline the business overall.
