GameStop Closing 150 Stores Nationwide

LAKEWOOD, OH - The video game retailer GameStop announced it would close approximately 150 outlets throughout the nation last week. The company said it had experienced a nearly 13 percent drop in total global sales in the fourth quarter of 2016.

The company has not announced which stores will be closing, though it does operate approximately 10 stores near Lakewood, and more throughout the Northeast Ohio region. Nationwide, GameStop has about 7,500 brick-and-mortar retail outlets.

The company's CEO, Paul Raines, blamed weak console sales for the company's weak performance in 2016. In a statement to investors, he said, “GameStop’s transformation continued to take hold in 2016, as our non-gaming businesses drove gross margin expansion and significantly contributed to our profits. Meanwhile, the video game category was weak, particularly in the back half of 2016, as the console cycle ages."

Raines went on to say that the company believes it will recoup some of its growth by opening new collectible stores. The Columbus Underground reports that GameStop plans to open 35 new collectible stores and 65 new technology branded stores in 2017, compensating for the loss of 150 or more video game stores.

"Looking at 2017, Technology Brands and Collectibles are expected to generate another year of strong growth, and new hardware innovation in the video game category looks promising. As we continue our transformation plan, we will also be focused on managing SG&A spend, rationalizing our global store portfolio, and maximizing free cash flow generation to drive shareholder value,”Raines said.

Photo from Bentley Mall, Wikimedia Commons