GameStop Corp. is an American

video game Video games, also known as computer games, are electronic games that involves interaction with a user interface or input device such as a joystick, game controller, controller, computer keyboard, keyboard, or motion sensing device to gener ...

, consumer electronics, and gaming merchandise retailer. The company is headquartered in

Grapevine, Texas Grapevine is a city and suburb of Dallas and Fort Worth located in northeast Tarrant County, Texas, United States, with minor portions extending into Dallas County and Denton County. The city is located in the Mid-Cities suburban region betwe ...

(a suburb of

Dallas Dallas () is the List of municipalities in Texas, third largest city in Texas and the largest city in the Dallas–Fort Worth metroplex, the List of metropolitan statistical areas, fourth-largest metropolitan area in the United States at 7.5 ...

), and is the largest video game retailer worldwide. , the company operates 4,573 stores including 3,018 in the United States, 231 in

Canada Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by tota ...

, 417 in Australia and 907 in

Europe Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a subcontinent of Eurasia and it is located enti ...

under the GameStop, EB Games, EB Games Australia, Micromania-Zing, ThinkGeek and Zing Pop Culture brands. The company was founded in Dallas in 1984 as Babbage's, and took on its current name in 1999. The company's performance declined during the mid-to-late 2010s due to the shift of video game sales to

online shopping Online shopping is a form of electronic commerce which allows consumers to directly buy goods or services from a seller over the Internet using a web browser or a mobile app. Consumers find a product of interest by visiting the website of the ...

and failed investments by GameStop in

smartphone A smartphone is a portable computer device that combines mobile telephone and computing functions into one unit. They are distinguished from feature phones by their stronger hardware capabilities and extensive mobile operating systems, whic ...

retail. In 2021, the company's stock price skyrocketed due to a short squeeze orchestrated by users of the

Internet forum An Internet forum, or message board, is an online discussion site where people can hold conversations in the form of posted messages. They differ from chat rooms in that messages are often longer than one line of text, and are at least tempora ...

r/wallstreetbets. The company received significant media attention during January and February 2021 due to the volatility of its stock price and the GameStop short squeeze. The company is now ranked 521st on the

Fortune 500 The ''Fortune'' 500 is an annual list compiled and published by '' Fortune'' magazine that ranks 500 of the largest United States corporations by total revenue for their respective fiscal years. The list includes publicly held companies, along ...

. In addition to retail stores, GameStop owns and publishes ''

Game Informer ''Game Informer'' (''GI'', most often stylized ''gameinformer'' from the 2010s onward) is an American monthly video game magazine featuring articles, news, strategy, and reviews of video games and associated consoles. It debuted in August 1991 ...

'', a video game magazine.

History

Babbage's (1984–1994)

GameStop traces its roots to Babbage's, a Dallas, Texas-based

software Software is a set of computer programs and associated software documentation, documentation and data (computing), data. This is in contrast to Computer hardware, hardware, from which the system is built and which actually performs the work. ...

retailer founded in 1984 by former

Harvard Business School Harvard Business School (HBS) is the graduate business school of Harvard University, a private research university in Boston, Massachusetts. It is consistently ranked among the top business schools in the world and offers a large full-time MBA ...

classmates James McCurry and

Gary M. Kusin Gary M. Kusin (born 1951) is an American entrepreneur best known as the founder of GameStop. Biography In 1984, Kusin co-founded video game retailer Babbage's, which is now known as GameStop. In February 1995, one year after Babbage's merger wit ...

. The company was named after

Charles Babbage Charles Babbage (; 26 December 1791 – 18 October 1871) was an English polymath. A mathematician, philosopher, inventor and mechanical engineer, Babbage originated the concept of a digital programmable computer. Babbage is considered ...

and opened its first store in Dallas's NorthPark Center with the help of

Ross Perot Henry Ross Perot (; June 27, 1930 – July 9, 2019) was an American business magnate, billionaire, politician and philanthropist. He was the founder and chief executive officer of Electronic Data Systems and Perot Systems. He ran an inde ...

, an early investor in the company. The company quickly began to focus on video game sales for the then-dominant

Atari 2600 The Atari 2600, initially branded as the Atari Video Computer System (Atari VCS) from its release until November 1982, is a home video game console developed and produced by Atari, Inc. Released in September 1977, it popularized microprocess ...

. Babbage's began selling Nintendo games in 1987. Babbage's became a

public company A public company is a company whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets. A public (publicly traded) company can be listed on a stock exchange ( l ...

via an

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investme ...

in 1988. By 1991, video games accounted for two-thirds of Babbage's sales.

NeoStar Retail Group (1994–1996)

Babbage's merged with Software Etc., an

Edina, Minnesota Edina ( ) is a city in Hennepin County, Minnesota, United States and a first-ring suburb of Minneapolis. The population was 53,494 at the 2020 census, making it the 18th most populous city in Minnesota. Edina began as a small farming and mil ...

-based retailer that specialized in personal computing software, to create NeoStar Retail Group in 1994. The merger was structured as a stock swap, where shareholders of Babbage's and Software Etc. received shares of NeoStar, a newly formed

holding company A holding company is a company whose primary business is holding a controlling interest in the securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own shares of other companies ...

. Babbage's and Software Etc. continued to operate as independent subsidiaries of NeoStar and retained their respective senior management teams. Babbage's founder and chairman James McCurry became chairman of NeoStar, while Babbage's president Gary Kusin and Software Etc. President Daniel DeMatteo retained their respective titles. Software Etc. chairman

Leonard Riggio Leonard S. Riggio (born February 28, 1941)
''

chief operating officer A chief operating officer or chief operations officer, also called a COO, is one of the highest-ranking executive positions in an organization, composing part of the " C-suite". The COO is usually the second-in-command at the firm, especially if t ...

of NeoStar. NeoStar chairman James McCurry was also appointed to the newly created position of NeoStar CEO. The company relocated from its headquarters in Dallas to Grapevine later that year. NeoStar merged its Babbage's and Software Etc. units into a single organization in May 1996 amid declining sales. Company president Daniel DeMatteo also resigned, and NeoStar chairman and CEO James McCurry assumed the title of president. In September of that year, after NeoStar was unable to secure the credit necessary to purchase inventory necessary for the holiday season, the company filed for

Chapter 11 Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, whet ...

bankruptcy and appointed

Thomas G. Plaskett Thomas George Plaskett (December 24, 1943June 24, 2021) was an American business executive. He served as CEO of Continental Airlines, Pan American World Airways, and Greyhound Lines. He was instrumental in establishing AAdvantage. Early life and ...

chairman while James McCurry remained company chief executive and president. The leadership changes were not enough and in November 1996 the assets of NeoStar were purchased for $58.5 million by

Leonard Riggio Leonard S. Riggio (born February 28, 1941)
''

Barnes & Noble. Electronics Boutique had also bid to purchase NeoStar, but the judge presiding over NeoStar's bankruptcy accepted Riggio's bid because it kept open 108 stores more than Electronics Boutique's bid would have. Approximately 200 retail stores were not included in the transaction and were subsequently closed.

Babbage's Etc. (1996–1999)

Following his purchase of NeoStar's assets, Leonard Riggio dissolved the holding company and created a new holding company named Babbage's Etc. He appointed Richard "Dick" Fontaine, previously Software Etc.'s chief executive during its expansion in the late 1980s and early 1990s, as Babbage Etc.'s chief executive. Daniel DeMatteo, previously the president of both Software Etc. and NeoStar, became company president and COO. Three years later, in 1999, Babbage's Etc. launched its GameStop brand with 30 stores in

strip mall A strip mall, strip center or strip plaza is a type of shopping center common in North America where the stores are arranged in a row, with a sidewalk in front. Strip malls are typically developed as a unit and have large parking lots in front. ...

s. The company also launched gamestop.com, a website that allowed consumers to purchase video games online. GameStop.com was promoted in Babbage's and Software Etc. stores.

Barnes & Noble Booksellers (1999–2004)

In October 1999, Barnes & Noble Booksellers purchased Babbage's Etc. for $215 million. Because Babbage's Etc. was principally owned by Leonard Riggio, who was also Barnes & Noble's chairman and principal shareholder, a special committee of independent directors of Barnes & Noble Booksellers evaluated and signed off on the deal. A few months later, in May 2000, Barnes & Noble acquired Funco, the owner of Eden Prairie, Minnesota-based video game retailer FuncoLand, for $160 million. Babbage's Etc., which had been previously operating as a direct subsidiary of Barnes & Noble, became a wholly owned subsidiary of Funco. With its acquisition of Funco, Barnes & Noble also acquired

, a video game magazine that was first published in 1991. Funco was renamed GameStop, Inc. in December 2000 in anticipation of holding an

for the company. In February 2002, the company once again became a

via an

. Barnes & Noble retained control over the newly public company with 67% of outstanding shares and 95% of voting shares. Barnes & Noble retained control over GameStop until October 2004, when it distributed its 59% stake in GameStop to stakeholders of Barnes & Noble, making it an independent company.

Expansion (2004–2016)

Acquisitions

* In 2005 GameStop acquired EB Games (formerly Electronics Boutique) for $1.44 billion. This expanded GameStop's operations into Australia, Canada, Europe and New Zealand. GameStop's operations expanded to over 4,250 stores worldwide as a result of the acquisition. * In 2007, GameStop acquired Rhino Video Games, who operated 70 video game stores throughout the

Southeastern United States The Southeastern United States, also referred to as the American Southeast or simply the Southeast, is a geographical region of the United States. It is located broadly on the eastern portion of the southern United States and the southern po ...

, from

Blockbuster LLC Blockbuster LLC, formerly known as Blockbuster Video, was an American-based provider of home video and video game rental services. Services were offered primarily at video rental shops, but later alternatives included DVD-by-mail, streaming, ...

for an undisclosed amount. * In April 2008, GameStop acquired

Free Record Shop Free Record Shop was a chain of home entertainment stores selling products such as CDs, DVDs and video games, founded by Hans Breukhoven. Its first store opened on October 15, 1971 in Schiedam, Netherlands. At its peak, the franchise had more tha ...

's 49 Norwegian stores. * In October 2008, GameStop acquired Micromania, a French video-game retailer, for $700 million. GameStop, which had previously owned no stores in France, now had 332 French video-game stores. * In November 2009, it acquired a majority stake in

Jolt Online Gaming Jolt Online Gaming was an online gaming company hosted in Ireland. Its main site provided news, reviews, and interviews concerning upcoming games on consoles and computers, while its gaming network Jolt Online Gaming Network hosted and published f ...

, an Irish browser game studio. Jolt closed in 2012. * In 2010, GameStop acquired Kongregate, a

San Francisco San Francisco (; Spanish language, Spanish for "Francis of Assisi, Saint Francis"), officially the City and County of San Francisco, is the commercial, financial, and cultural center of Northern California. The city proper is the List of Ca ...

-based website for browser-based games. In 2017, it was sold for $55 million. * In 2011, GameStop acquired Spawn Labs and Impulse in separate transactions. Spawn Labs was a developer of technology that allowed users to play video games that were run remotely on machines in data centers rather than their personal computer or console. Impulse was a

digital distribution Digital distribution, also referred to as content delivery, online distribution, or electronic software distribution, among others, is the delivery or distribution of digital media content such as audio, video, e-books, video games, and othe ...

and

multiplayer video game A multiplayer video game is a video game in which more than one person can play in the same game environment at the same time, either locally on the same computing system ( couch co-op), on different computing systems via a local area network, o ...

platform acquired from Stardock, and renamed GameStop PC Downloads. Under the ownership of GameStop, the service was redesigned and sold games that use other platforms such as Steam while also selling games that use its own proprietary DRM solution, Impulse:Reactor. GameStop shut down both PC Downloads and Spawn Labs in 2014. * In 2012, GameStop acquired BuyMyTronics, a

Denver Denver () is a consolidated city and county, the capital, and most populous city of the U.S. state of Colorado. Its population was 715,522 at the 2020 census, a 19.22% increase since 2010. It is the 19th-most populous city in the United ...

-based online market place for consumer electronics. * In October 2012, GameStop acquired a 49.9% ownership interest in Simply Mac, a

Salt Lake City Salt Lake City (often shortened to Salt Lake and abbreviated as SLC) is the capital and most populous city of Utah, United States. It is the seat of Salt Lake County, the most populous county in Utah. With a population of 200,133 in 2020, th ...

-based

Apple An apple is an edible fruit produced by an apple tree (''Malus domestica''). Apple trees are cultivated worldwide and are the most widely grown species in the genus '' Malus''. The tree originated in Central Asia, where its wild ances ...

authorized reseller and repairer founded in 2006. GameStop acquired the remaining 50.1% of ownership in November 2013. GameStop tried to target areas for potential new Simply Mac locations in smaller markets that did not have an existing

Apple Store The Apple Store is a chain of retail stores owned and operated by Apple Inc. The stores sell various Apple products, including Mac personal computers, iPhone smartphones, iPad tablet computers, Apple Watch smartwatches, Apple TV digital m ...

within a reasonable driving distance. In January 2017, GameStop closed many Simply Mac locations. The chain had as many as 70 locations at the time of the announcement. In 2019, GameStop divested Simply Mac; at that time it had 43 stores. * In November 2013, GameStop acquired Spring Mobile, a

-based retailer of

AT&T AT&T Inc. is an American multinational telecommunications holding company headquartered at Whitacre Tower in Downtown Dallas, Texas. It is the world's largest telecommunications company by revenue and the third largest provider of mobile tel ...

-branded wireless services. * It acquired 163 RadioShack locations in February 2015. * In July 2015, GameStop acquired Geeknet. * On August 3, 2016, GameStop acquired 507 AT&T store chains in plans to diversify into new businesses and less dependent on the video game market.

Brand expansion

GameStop founded MovieStop in 2004 as a standalone store that focused on new and used movies. More than 42 locations were opened, which typically adjoined or were adjacent to GameStop locations. GameStop spun off MovieStop to private owners in 2012. In November 2014, Draw Another Circle LLC, a company controlled by merchandising executive Joel Weinshanker that also owns

Hastings Entertainment Hastings Entertainment was an American retail chain that sold books, movies, music, and video games and functioned as a video rental shop. As of 2016 it had 126 superstores, which were mainly located in the South Central United States, R ...

, purchased MovieStop. The chain shuttered in 2016. In October 2012 at

Grapevine Mills Grapevine Mills is a shopping mall in Grapevine, Texas, United States, in the Dallas-Fort Worth metropolitan area. Grapevine Mills currently totals over in size. Grapevine Mills opened on October 30, 1997, and is one of the largest malls owned ...

in Dallas, GameStop introduced GameStop Kids, a pop-up retail concept. The brand, which had 80 locations in

shopping mall A shopping mall (or simply mall) is a North American term for a large indoor shopping center, usually anchored by department stores. The term "mall" originally meant a pedestrian promenade with shops along it (that is, the term was used to refe ...

s during the Christmas and holiday season, focused on children's products, and carried only games rated "Everyone" by the ESRB, along with merchandise of popular franchises aimed towards the demographic. In July 2014, GameStop's Australian Division EB Games Australia introduced ZiNG Pop Culturea pop culture retailer. ZiNG Pop Culture has since expanded to over 50 standalone stores as well as numerous large format hybrid stores, which include both an EB Games and Zing Pop Culture store in a single location with an expanded selection of games merchandise.

Management changes

Daniel DeMatteo replaced Richard Fontaine as GameStop CEO in August 2008. DeMatteo had served as company COO since 1996. Fontaine, who had been GameStop chairman and CEO since 1996, remained the company's chairman.

J. Paul Raines Julian Paul Raines (April 4, 1964 – March 4, 2018) was the CEO of GameStop, the largest retailer of video games worldwide, from 2010 to 2017. Early life and education Raines was born in 1964 in Costa Rica and raised in Atlanta, Georgia as a ...

, formerly executive vice president of Home Depot, became company COO in September.

became GameStop CEO in June 2010. He replaced Daniel DeMatteo who was named executive chairman of the company. Under his leadership, in 2012, GameStop's digital revenue grew from $190 million in 2011 to more than $600 million in 2012.

Decline (2016–present)

Merrick Theatre; Jamaica & Guy R Brewer-1

Changes in market conditions

The market for physical game media has been in a state of decline due to downloadable games on services such as Xbox Live,

PlayStation Network PlayStation Network (PSN) is a digital media entertainment service provided by Sony Interactive Entertainment. Launched in November 2006, PSN was originally conceived for the PlayStation video game consoles, but soon extended to encompass smar ...

Nintendo eShop The Nintendo eShop is a digital distribution service powered by the Nintendo Network for the Wii U and Nintendo 3DS, and by a dedicated online infrastructure for the Nintendo Switch. Launched in June 2011 on the Nintendo 3DS, the eShop was en ...

, and

Steam Steam is a substance containing water in the gas phase, and sometimes also an aerosol of liquid water droplets, or air. This may occur due to evaporation or due to boiling, where heat is applied until water reaches the enthalpy of vaporizat ...

. This has resulted in a decline in sales at GameStop. In 2017, GameStop reported a 16.4% drop in sales for the 2016 holiday season, but expressed optimism in its non-physical gaming businesses. In February 2017, it was revealed that GameStop enforced, on all of its retail employees, a program known as Circle of Life. The policy itself was made to ensure that each employee would allow a certain percentage of their sales to

pre-order A pre-order is an order placed for an item that has not yet been released. The idea for pre-orders came because people found it hard to get popular items in stores because of their popularity. Companies then had the idea to allow customers to r ...

s, rewards cards, used games, or have a customer trade in a game. Upon revelation of the policy, many current and former GameStop employees revealed stories of how the policy has led to them lying to customers. Many more claimed that the policy had led to poor working conditions and

emotional distress In medicine, distress is an aversive state in which a person is unable to completely adapt to stressors and their resulting stress and shows maladaptive behaviors. It can be evident in the presence of various phenomena, such as inappropriate soc ...

. Later that month, GameStop reformed the program to solely focus on the store as a whole instead of the previous individual employee basis, though still maintaining a heavy emphasis on the individuals' performance to maintain strong store metrics.

Financial losses

Shares of GameStop stock fell 16% in 2016. On February 28, 2017, shares dropped an additional 8% following Microsoft's announcement of its Xbox Game Pass service. Following these reports, GameStop announced it would close over 150 stores in 2017 and expand its non-gaming business. On the same day, however, GameStop said it planned to open 65 new Technology Brand stores and 35 Collectibles stores due to a 44% and 28% increase in sales, respectively. GameStop's total revenue fell 7.6% to $3.06 billion in the quarter ended February 2, 2018. ''

Business Insider ''Insider'', previously named ''Business Insider'' (''BI''), is an American financial and business news website founded in 2007. Since 2015, a majority stake in ''Business Insider''s parent company Insider Inc. has been owned by the German pub ...

'' described GameStop's investment in Spring Mobile as a failure, with estimates that the company spent $1.5 billion on acquisitions on Spring Mobile and store locations, but only gained $700 million from the sale of Spring Mobile to Prime Communications in 2018, leaving them $800 million in

debt Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The d ...

. In late June 2018, GameStop confirmed talks of a possible sale, with Sycamore Partners, a

private equity firm A private equity firm is an investment management company that provides financial backing and makes investments in the private equity of startup or operating companies through a variety of loosely affiliated investment strategies including le ...

, the most likely buyer, with a target deal expected by February 2019. However, on January 29, 2019, GameStop reported it had stopped looking for a buyer for the company, due to a "lack of available financing on terms that would be commercially acceptable to a prospective acquirer", and was looking for other actions to help re-establish its financial ground. Shares dropped 27% to a 14-year low immediately following this announcement. The financial results for 2018 showed the biggest loss in GameStop company history. For the 52-week period ending on February 2, 2019, GameStop reported a record-breaking net loss of $673 million. This was a change from the net profit of $34.7 million in the previous year. The net sales for fiscal year 2018 were down 3% year-on-year to $8.29 billion. The company also eliminated its

dividend A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-inv ...

. In December 2021, GameStop posted a larger-than-expected loss in the fiscal third quarter, and investors are waiting to hear how the ailing company plans to restructure its operations and entice gamers back. In extended trade, shares plummeted.

Management changes

After being on medical leave since November 2017 due to reoccurrence of a

brain tumor A brain tumor occurs when abnormal cells form within the brain. There are two main types of tumors: malignant tumors and benign (non-cancerous) tumors. These can be further classified as primary tumors, which start within the brain, and secon ...

resigned from GameStop on January 31, 2018, and died on March 4, 2018. DeMatteo, GameStop's executive chairman stepped in as interim chief executive officer. On February 6, 2018, the company announced Michael K. Mauler as CEO and member of the board of directors. On May 11, 2018, Mauler resigned due to "personal reasons" and chairman Dan DeMatteo was named interim CEO. Mauler did not take any severance package or separation benefits. On May 31, 2018, GameStop named Shane Kim as interim CEO. Kim was replaced by George Sherman in March 2019. On March 12, 2020, it was announced that a group of shareholders including Hestia Capital Partners LP and Permit Capital Enterprise Fund LP sent a "threat" letter to the Grapevine, Texas, company's board, urging it to appoint a stockholder representative as a director.

Turnaround efforts

=American Division Efforts

All GameStop stores in

Puerto Rico Puerto Rico (; abbreviated PR; tnq, Boriken, ''Borinquen''), officially the Commonwealth of Puerto Rico ( es, link=yes, Estado Libre Asociado de Puerto Rico, lit=Free Associated State of Puerto Rico), is a Caribbean island and Unincorporated ...

were shut at the end of March 2016, citing increased rates of government taxes. In July 2019, GameStop partnered with an outside design firm, R/GA, to put forth plans to revamp stores to focus on

competitive gaming Esports, short for electronic sports, is a form of competition using video games. Esports often takes the form of organized, multiplayer video game competitions, particularly between professional players, individually or as teams. Although orga ...

and retrogaming, and to introduce new ways for customers to try games before buying them. Each concept store is expected to be mutually exclusive. GameStop interior 2019

A leaked email revealed on July 31, 2019, indicated that 50 employees, including district and regional managers, would be laid off as a result of reorganization efforts. In August 2019, GameStop laid off over 120 people, including about half of the staff of ''Game Informer'', as part of its "GameStop Reboot initiative". In August 2019,

Michael Burry Michael James Burry (; born June 19, 1971) is an American investor, hedge fund manager, and physician. He founded the hedge fund Scion Capital, which he ran from 2000 until 2008 before closing it to focus on his personal investments. He is best k ...

's investment firm Scion Asset Management sent a letter to GameStop executives urging the company to engage in a $238 million

stock buyback Share repurchase, also known as share buyback or stock buyback, is the re-acquisition by a company of its own shares. It represents an alternate and more flexible way (relative to dividends) of returning money to shareholders. When used in coord ...

. The letter also revealed that Scion owned approximately 2,750,000 shares, or about 3.05% of GameStop. The stock price of GameStop, which had been in steady decline in share price since late January 2019, spiked roughly 20% after Burry revealed that he was buying the stock in an interview with '' Barron's''. In the interview, Burry explained that both

Sony , commonly stylized as SONY, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan. As a major technology company, it operates as one of the world's largest manufacturers of consumer and professional ...

and

Microsoft Microsoft Corporation is an American multinational corporation, multinational technology company, technology corporation producing Software, computer software, consumer electronics, personal computers, and related services headquartered at th ...

would enter the next console generation with a physical disc drive and therefore likely extend the longevity of GameStop. He also noted that the company's balance sheet was in good condition. In December 2019, GameStop announced that it spent $178.6 million to buy 34.6 million shares, or 34% of the shares outstanding, at an average price of $5.14 per share. In May 2020, Burry lowered his stake in GameStop. After reporting that it had missed analysts' expectations during the 2nd quarter of the fiscal year 2019 ending August 2019, as reported in September 2019, GameStop announced that it was planning to close about 180–200 underperforming stores of the 5,700 it had worldwide in the short term, along with developing metrics to evaluate other potential closures over the next two years. In March 2020, four members of GameStop's Board of Directors - Dan DeMatteo, Gerald Szczepanski, Larry Zilavy, and Steve Koonin - stepped down and were replaced by

Reggie Fils-Aimé Reginald Fils-Aimé ( ; born March 25, 1961) is an American businessman best known for being the president and chief operating officer of Nintendo of America, the North American division of the Japanese video game company Nintendo, from 2 ...

, Bill Simon and J.K. Symancyk as part of the company's effort to turn around the business. On October 8, 2020, GameStop announced an agreement with Microsoft to migrate backend systems to Microsoft 365 platforms including Dynamics 365, also including in-store usage of

Microsoft Surface Microsoft Surface is a series of touchscreen-based personal computers, tablets and interactive whiteboards designed and developed by Microsoft, running the Microsoft Windows operating system, apart from the Surface Duo, which runs on Andro ...

products by employees. It was later reported that this agreement would also include revenue sharing on all digital game purchases for

Xbox Series X and S The Xbox Series X/S are home video game consoles developed by Microsoft. They were both released on November 10, 2020, as the fourth generation Xbox, succeeding the Xbox One. Along with Sony's PlayStation 5, also released in November 2020, t ...

for each product sold by the retailer, although the exact percentage of this share was not disclosed.

=Australian Division Efforts

GameStop's Australian division has been focused on increasing higher-margin merchandise and opening more large format hybrid stores which include both an EB Games and Zing Pop Culture store in a single location. These locations have an expanded selection of merchandise based on both games and pop culture.

The Sydney Morning Herald ''The Sydney Morning Herald'' (''SMH'') is a daily compact newspaper published in Sydney, New South Wales, Australia, and owned by Nine. Founded in 1831 as the ''Sydney Herald'', the ''Herald'' is the oldest continuously published newspaper ...

reported the diversification into merchandise through the establishment of the Zing Pop Culture brand in 2014 had been vital in keeping the company profitable. The newspaper reported the greater focus on merchandise allowed the company to tap into the lucrative, higher-margin merchandise market of t-shirts, figurines and bobbleheads. The newspaper noted former staff agreed that the Australian divisions’ merchandise pivot has been key to the divisions survival in Australia’s tough retail landscape. However, they also pointed to the pre-owned games segment as a major part of its success. GameStop's Australian division has been the only profitable segment of the global GameStop business for the 2020, 2021 and 2022 fiscal years. The company reported profits of US$9.4 million, US$52.2 million and US$30.6 million for each fiscal year respectively.

COVID-19 pandemic

=American Division Pandemic Response

Gamestop Liquidation - Melbourne Square Mall - Melbourne, FL

Government efforts to slow the spread of

COVID-19 Coronavirus disease 2019 (COVID-19) is a contagious disease caused by a virus, the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The first known case was identified in Wuhan, China, in December 2019. The disease quickl ...

required GameStop to close the physical operation of all of its 3,500 stores from roughly March to May 2020, though not without some controversy in the early stages. Throughout this time, it continued with online and curbside sales. Sherman and the board of directors took a 50% pay cut while other executives took a 30% cut to offset losses. While digital sales grew by 519%, its retail dropped by more than 30% in the same period from the prior year, and the chain reported a loss in contrast to a for the same quarter in 2019. However, with the Xbox Series X and

PlayStation 5 The PlayStation 5 (PS5) is a home video game console developed by Sony Interactive Entertainment. Announced as the successor to the PlayStation 4 in April 2019, it was launched on November 12, 2020, in Australia, Japan, New Zealand, North A ...

still planned for release in the latter part of 2020, Sherman expected to be able to recover from these losses. In mid-March 2020, GameStop faced criticism for its response to the

COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identified ...

in North America, with employees and social media users accusing the company of placing its business ahead of the safety of its staff and customers, in order to capitalize on an influx of video game purchases and related products for entertainment during the pandemic and related lockdowns. GameStop stated that it would suspend in-store events (including midnight launches) and the use of demo stations, perform additional cleaning, and structure lines and limit store capacity to enforce physical distancing. To prevent enlarged crowds for two high-profile video game releases on March 20 — '' Animal Crossing: New Horizons'' and '' Doom Eternal'', GameStop announced that it would begin selling ''Doom Eternal'' in its stores a day ahead of its official release date. ''

Polygon In geometry, a polygon () is a plane figure that is described by a finite number of straight line segments connected to form a closed '' polygonal chain'' (or ''polygonal circuit''). The bounded plane region, the bounding circuit, or the two t ...

'' reported on March 17 that several stores in the San Francisco area had remained open, seemingly in violation of a stay-at-home order issued by Bay Area counties that restricts non-essential business. Several employees told ''Polygon'' and ''

Vice A vice is a practice, behaviour, or Habit (psychology), habit generally considered immorality, immoral, sinful, crime, criminal, rude, taboo, depraved, degrading, deviant or perverted in the associated society. In more minor usage, vice can refe ...

'' that they did not receive additional cleaning supplies that were to be provided by corporate, requiring them to purchase them on their own and request reimbursement. A memo obtained by ''

Kotaku ''Kotaku'' is a video game website and blog that was originally launched in 2004 as part of the Gawker Media network. Notable former contributors to the site include Luke Smith, Cecilia D'Anastasio, Tim Rogers, and Jason Schreier. History ...

'' on March 19 indicated that GameStop saw itself as an

essential business Essential services may refer to a class of occupations that have been legislated by a government to have special restrictions in regard to labour actions such as not being allowed to strike. The International Labour Office, a United Nations ...

because some of its technology products are relevant to enhancing

remote work Remote work, also called work from home (WFH), work from anywhere, telework, remote job, mobile work, and distance work is an employment arrangement in which employees do not commute to a central place of work, such as an office building, w ...

, required in many cases during the pandemic. GameStop reiterated the safety measures that it had put in place, and also announced that it would reduce store hours and suspend all trade-ins until at least March 29, 2020, and offer curbside pickup. An employee of a GameStop store in

Athens, Georgia Athens, officially Athens–Clarke County, is a consolidated city-county and college town in the U.S. state of Georgia. Athens lies about northeast of downtown Atlanta, and is a satellite city of the capital. The University of Georgia, the st ...

(which was shut down on March 20 by order of the police to comply with a similar order in Athens-Clark County) disputed the argument, saying that the high-end, gaming-oriented peripherals (such as keyboards and mice) sold at GameStop were not necessarily essential for remote work, and that cheaper alternatives were readily available at stores allowed to remain open, such as

Walmart Walmart Inc. (; formerly Wal-Mart Stores, Inc.) is an American multinational retail corporation that operates a chain of hypermarkets (also called supercenters), discount department stores, and grocery stores from the United States, headquarter ...

California California is a state in the Western United States, located along the Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the most populous U.S. state and the 3rd largest by area. It is also the ...

had announced a state-wide stay-at-home order on March 19; while GameStop had originally stated to its stores it was an essential retail business, by March 20 GameStop instead decided to close down its California branches, while keeping most other nationwide stores open. Following similar stay-at-home orders in

New York New York most commonly refers to: * New York City, the most populous city in the United States, located in the state of New York * New York (state), a state in the northeastern United States New York may also refer to: Film and television * '' ...

and

Illinois Illinois ( ) is a state in the Midwestern United States. Its largest metropolitan areas include the Chicago metropolitan area, and the Metro East section, of Greater St. Louis. Other smaller metropolitan areas include, Peoria and Roc ...

over the following days, GameStop announced that it would close all locations effective March 22, with selected locations continuing to offer contact-free curbside pickup (where an employee, wearing either gloves or a bag over their hands, would slip the customer's order through the front door, remaining behind the glass) and home delivery. In early April 2020, a location in

Dorchester, Boston Dorchester (colloquially referred to as Dot) is a Boston neighborhood comprising more than in the City of Boston, Massachusetts, United States. Originally, Dorchester was a separate town, founded by Puritans who emigrated in 1630 from Dorchester ...

received a nuisance citation by local police, who deemed the curbside pickup a violation of the

Massachusetts Massachusetts (Massachusett language, Massachusett: ''Muhsachuweesut assachusett writing systems, məhswatʃəwiːsət'' English: , ), officially the Commonwealth of Massachusetts, is the most populous U.S. state, state in the New England ...

stay-at-home order. GameStop subsequently ceased offering curbside pickup in the state.

=Canadian Division Pandemic Response

= GameStop's Canadian subsidiary EB Games faced similar criticism on March 20 as well, as morning lineups for the new ''Animal Crossing'' and ''Doom'' games at a Toronto location induced large public gatherings discouraged by officials. The city's public health chief Eileen de Villa stated that the gathering did not "line up with what we expect from those in our community who are interested in protecting and strengthening our community".

Mayor In many countries, a mayor is the highest-ranking official in a municipal government such as that of a city or a town. Worldwide, there is a wide variance in local laws and customs regarding the powers and responsibilities of a mayor as well as ...

John Tory accused the company of "plac ngcommerce above the public interest", while

Premier of Ontario The premier of Ontario (french: premier ministre de l'Ontario) is the head of government of Ontario. Under the Westminster system, the premier governs with the confidence of a majority the elected Legislative Assembly; as such, the premier typ ...

Doug Ford Douglas Robert Ford Jr. (born November 20, 1964) is a Canadian politician and businessman who has served as the 26th and current premier of Ontario since June 2018 and leader of the Progressive Conservative Party of Ontario, Progressive Cons ...

stated that "everyone in this province has a responsibility to make sure we protect each other and I am very, very disappointed in the store owner that would do this". EB Games later announced that it would close all Canadian stores on March 21.

=Australian Division Pandemic Response

GameStop's Australian subsidiary EB Games Australia was the only arm of the global GameStop business not to report huge COVID-related losses, with sales instead soaring by 30 per cent. In Australia COVID-19 lockdowns were managed by the Australian Federal Government National Cabinet which largely permitted retail stores to remain open with capacity limits in place. This meant, unlike other arms of the GameStop business, the Australian arms stores remained open for the substantial majority of the pandemic. National Cabinet only mandated some brief regionally targeted entire store closures with stores in the Australian state of Victoria being the most heavily impacted. For fiscal year 2020 the Australian arm reported net sales of US$625.3 million and operating earnings of US$52.2 million. This was an increase of US$42.8 million in operating earnings compared to the pre-pandemic Fiscal Year 2019 where the company posted net sales of US$525.4 million and operating earnings of US$9.4 million.

January 2021 short squeeze

In January 2021, a short squeeze resulted in a 1,500% increase in GameStop's share price over the course of two weeks, reaching an all-time intraday high of US$483.00 , on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed ...

. This effect was mainly attributed to a coordinated effort by the

Reddit Reddit (; stylized in all lowercase as reddit) is an American social news news aggregator, aggregation, Review site#Rating site, content rating, and Internet forum, discussion website. Registered users (commonly referred to as "Redditors") subm ...

community r/wallstreetbets, a subreddit dedicated to stocks with high

market risk Market risk is the risk of losses in positions arising from movements in market variables like prices and volatility. There is no unique classification as each classification may refer to different aspects of market risk. Nevertheless, the mos ...

. A surge in the stock price in extended-hours trading occurred after

Elon Musk Elon Reeve Musk ( ; born June 28, 1971) is a business magnate and investor. He is the founder, CEO and chief engineer of SpaceX; angel investor, CEO and product architect of Tesla, Inc.; owner and CEO of Twitter, Inc.; founder of The ...

made a post on

Twitter Twitter is an online social media and social networking service owned and operated by American company Twitter, Inc., on which users post and interact with 280-character-long messages known as "tweets". Registered users can post, like, and ...

that included "Game stonk!" (in reference to r/wallstreetbets) and a link to the community. Matt Levine has compared the situation to the 2012 "short squeeze" that the SEC charged Philip Falcone with. In February 2021, GameStop announced that its finance chief Jim Bell, appointed in June 2019, would leave the company on March 26, 2021. Though no official reason was given for Bell's departure, the company said that it did not have to do with a disagreement with the company or its operations. In April 2021, George Sherman announced that he will step down as CEO of GameStop by July 31, 2021. Also in April 2021, Ryan Cohen, founder of

Chewy Chewy may refer to: * Chewy (company), pet food company based in the United States * '' Chewy: Esc from F5'', a 1996 computer game and its title character * Andrew Lichtenberger (born 1987), American poker player * Daniel Mongrain (born 1976), ...

and a large GameStop shareholder, was named chairman, effective in June 2021. On June 9, 2021, GameStop appointed former

Amazon Amazon most often refers to: * Amazons, a tribe of female warriors in Greek mythology * Amazon rainforest, a rainforest covering most of the Amazon basin * Amazon River, in South America * Amazon (company), an American multinational technolog ...

executives Matt Furlong and Mike Recupero as CEO and CFO respectively. Furlong took over the position of CEO from Sherman on June 21, 2021. In July 2022, it was announced that Mike Recupero was fired as CFO. He was replaced by Diana Saadeh-Jajeh, who was the company's chief accounting officer.

NFT platform

On May 26, 2021, GameStop announced that it was working on a

non-fungible token A non-fungible token (NFT) is a unique digital identifier that cannot be copied, substituted, or subdivided, that is recorded in a blockchain, and that is used to certify authenticity and ownership. The ownership of an NFT is recorded in the ...

(NFT) platform creating a token that is based on

blockchain A blockchain is a type of distributed ledger technology (DLT) that consists of growing lists of records, called ''blocks'', that are securely linked together using cryptography. Each block contains a cryptographic hash of the previous block, ...

Ethereum technology. ''Business Insider'' reported that "GameStop is building an NFT platform as part of an ambitious plan to transform itself into the Amazon of gaming." The Beta version of the platform launched on July 11, 2022. The marketplace is curated, with a vetting process in place for artists; in July 2022 GameStop removed an NFT associated with artwork which referenced the photo '' The Falling Man'' and removed the ability for the creator's account to mint new NFTs on its platform. In another case, a user sold hundreds of NFTs associated with HTML5 games they did not have a license for. GameStop removed their minting ability and the listings for the NFTs on their marketplace, although the NFTs themselves remain on the blockchain, the games themselves on Gamestop's servers, and can be sold on other marketplaces.

Business operations

Atrix

Atrix (formerly @play) is GameStop, Incs. in-house store brand. GameStop sells gaming accessories, Headsets, Mice and Keyboards under the Atrix brand.

''Game Informer''

'' is a magazine owned by GameStop, Inc. and primarily sold through subscriptions which can be purchased at GameStop locations. A subscription to the magazine is included for members of GameStop's PowerUp Rewards Pro loyalty program.

Trade-ins

GameStop provides its customers either cash or trade credit in exchange for customers' unwanted video games, accessories, and tech. The used video game trade-ins have twice the

gross margin Gross margin is the difference between revenue and cost of goods sold (COGS), divided by revenue. Gross margin is expressed as a percentage. Generally, it is calculated as the selling price of an item, less the cost of goods sold (e. g. product ...

s of new video game sales. Some video game developers and publishers have criticized GameStop for its practices, as they receive no share of the revenue from the sale of used games. GameStop responded to these criticisms in 2009 by stating that 70% of store credit generated by game trade ins was used to purchase new rather than used games, generating close to $2 billion in annual revenue.

GameStop TV

GameStop TV is the in-store television network run internally by GameStop, with non-endemic sales in partnership with Playwire Media. GameStop TV features programming targeted to consumers shopping in GameStop stores. Each month brings content segments about upcoming video game releases, exclusive developer interviews, and product demonstrations.

Pre-order bonuses

Game publishers obtain more pre-orders by including exclusive in-game or physical bonuses, available only if the player pre-ordered the game. Bonuses typically include extras such as exclusive characters, weapons, and maps. For example, GameStop included an additional avatar costume for '' Call of Duty: Black Ops'' when it was released in November 2010, and a pictorial Art-Folio for '' Metroid: Other M''. Soundtracks, artbooks, plushies, figurines, posters, and T-shirts have also been special bonuses.

GameTrust Games

In January 2016, GameStop announced a partnership with Insomniac Games with its 2016 title '' Song of the Deep''. GameStop executive Mark Stanley said the concept was to help the chain have more direct communication with players, and would expect to expand out to other similar distribution deals with other developers if this one succeeds. In April 2016, GameStop created the GameTrust Games publishing division to serve as a publisher for mid-sized developers. In April 2016, GameTrust Games announced it was working with Ready At Dawn, Tequila Works, and Frozenbyte to prepare more titles.

Corporate affairs

Store Count

, the company operated 4,573 stores including 3,018 in the United States Division, 231 in the

Division, 417 in the Australia Division and 907 in the

Division. Acquired a majority interest in Gamesworld Group Limited (“Gamesworld”), an Ireland-based video game retailer operating 10 stores expanding GameStop's operations into Ireland. Acquired Electronics Boutique Holdings Corp. ("EB Games"), a United States-based video games retailer operating approximately 2,300 stores expanding GameStop's operations in/into Australia, Canada, Europe, New Zealand and the United States. Acquired Game Brands Inc. ("Rhino Video Games"), a United States-based video game retailer operating 72 stores and expanding GameStop's United States operations Acquired The Gamesman Limited ("The Gamesman"), a New Zealand-based video game retailer operating 8 video game stores expanding GameStop's operations in New Zealand. Acquired SFMI Micromania ("Micromania"), a France-based video game retailer operating 332 video game stores expanding GameStop's operations into France. Acquired Free Record Shop Norway AS ("Free Record Shop"), a Norway-based record store retailer operating 49 stores. GameStop converted these record stores into video game stores. Acquired Simply Mac, Inc. (“Simply Mac”), a United States-based Apple specialty store retailer. Acquired Spring Communications, Inc. (“Spring Mobile”), a United States-based Apple wireless retailer. Launched Zing Pop Culture, an Australia-based Pop Culture retailer. Acquired Geeknet, Inc. ("ThinkGeek"), a United States-based online and wholesale Pop Culture retailer.

Subsidiaries

, GameStop Corp. operated 32 subsidiaries.

References

External links

* {{DEFAULTSORT:Gamestop 1984 establishments in Texas 2002 initial public offerings American companies established in 1984 Companies based in Grapevine, Texas Companies listed on the New York Stock Exchange Companies that filed for Chapter 11 bankruptcy in 1996 Retail companies established in 1984 Video game retailers of the United States Meme stock

History

Babbage's (1984–1994)

NeoStar Retail Group (1994–1996)

Babbage's Etc. (1996–1999)

Barnes & Noble Booksellers (1999–2004)

Expansion (2004–2016)

Acquisitions

Brand expansion

Management changes

Decline (2016–present)

Changes in market conditions

Financial losses

Management changes

Turnaround efforts

=American Division Efforts

=Australian Division Efforts

COVID-19 pandemic

=American Division Pandemic Response

=Canadian Division Pandemic Response

=Australian Division Pandemic Response

January 2021 short squeeze

NFT platform

Business operations

Atrix

''Game Informer''

Trade-ins

GameStop TV

Pre-order bonuses

GameTrust Games

Corporate affairs

Store Count

Subsidiaries

See also

References

External links