Will GameStop Go Out of Business?

The question: Will GameStop go out of business? is one that piques investor interest. GameStop stock, currently trading at a record high, defies business fundamentals, and its steep quarterly sales decline is troubling for many shareholders. The company, with its more than 5,000 stores, is unlikely to become the next Tesla or Amazon. It is a long-time staple of the video game retail business, but it is struggling to adapt to the growth of digital downloads and mobile gaming. Its employees are also keen to know whether their employers will survive and thrive.

While the game retail giant is facing competition from Amazon, GameStop has many options to stay afloat. For one thing, it could pivot its business model to more digital channels. Amazon and other online retailers have seen their sales rise over the past few years, and analysts expect more people to buy video games at home. PC game store Steam recently reported a record 21 million users. The company is also considering moving its customer support in-house.

But will GameStop go out of business? Those who work for the company will be the first to answer this question. Analysts say that GameStop needs to reposition itself as a technology company and stop prioritizing its brick-and-mortar footprint. In fact, the company is planning to close over 1,000 stores by the end of its current fiscal year. GameStop has also been diversifying its business, expanding to PC gaming, computers, monitors, and gaming TVs. However, a turnaround will likely take some time. And even then, analysts aren’t optimistic about the company’s CEO being a relevant gaming figure.
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