GameStop has had a rough few years, with the last year in particular having been very difficult for them. Those difficulties were punctuated with an eye-watering number today, as GameStop reported that, for the 12 months that ended on February 2, they suffered a massive, catastrophic $673 million loss.
To be clear, this is the same year in which GameStop sold off a section of its business for $700 million. They suffered a $673 million in losses in spite of that. GameStop seems to be aware of how severe the situation is, because it announced a “cost savings and profit improvement initiative”, which will include “supply chain efficiencies, operational improvements, expense savings, and pricing and promotion optimization” among other things. GameStop says that it doesn’t see this initiative affecting its 2019 performance, but hopes it will be good for its financial health in the long run.
But in the here and now, GameStop is suffering. The rise of digital sales, as well as physical game sales being appropriated by chains such as Best Buy, are factors clearly affecting its long term viability.