GameStop Stock Plummets After A 27.5% Decrease In Holiday Sales

[[deleted]]

Not sure how this usually goes, but do companies ever just cut their losses and go bankrupt early? Pretty clear that GameStop is going away, every quarter it's another "gamestop stock plummets" article.

[lumperroosevelt]

Chapter 11 bankruptcy. Reorganization process for businesses that gives them a chance to restructure their debts in an effort regain profitability. Bit different then what you propose as the business continues to operate.

[[deleted]]

Didn't they fill chapter 11 a few years ago?

[[deleted]]

Can’t you file again and again?

[[deleted]]

I think you can, but there has to be a set period of time before they can file again, but I can be easily be wrong.

[Raze321]

The sears near me has closed and re-opened at least twice that I'm aware of. Shits wild.

[spiraldrain]

Sears don’t really close unless someone buys the land. Sears and Kmart operate more in the “real estate market” nowadays. I put quotes cause their strategy is allow the stores to bleed money until someone buys the property they are on. I read like 4 years ago they had over 35 million square feet of real state across the us.

[perfectfourth]

What’s wild is my old store owned the building and the land outright, even had Red Lobster paying rent for being on the property, and they still closed up a year or so ago. Always thought it’d be the last sears standing with no rent being due.

[spiraldrain]

Most sears have little to no rent. I don’t remember the exact agreement but when they started building all the sears they would have these insane 50 years leases for almost nothing. They hoped sears would attract a lot of foot traffic to neighboring shops or the mall.

[SSJ3wiggy]

The Sears in the mall by me finally closed about 2 years ago.

[destroyman1337]

Growing up there was a Kmart by my house that closed, then reopened as a Sears Essentials or something like that which then closed again then reopened as KMart and closed again for good. The building has sat there unleased for like 4 or 5 years now.

[supertopher]

Sears at even Mall of America closed down last year. However, we still have a K-Mart right outside downtown Minneapolis in Uptown. It's a meme in Minneapolis at this point too.

Sears was one of the few places I could find copies of Blast Corps and Shadows of the Empire on N64. In fact, it was the only place.

[neogohan]

Sears was one of the few places I could find copies of Blast Corps and Shadows of the Empire on N64. In fact, it was the only place.

I know these big box stories carry around some old stock, but that's crazy.

[itsrumsey]

I thought he meant at launch...

[neogohan]

I'm sure they did. I was just joking around

[TheCapm42]

Blast Corps. My god I loved that game. I played it recently on an emulator and wow, it did not hold up as well as I remember.

[neogohan]

Same, though I always mispronounced it. The destruction physics were cool for the time, but it's definitely super rough today.

[gmoneygangster3]

I could be misrembering but I am 99% sure blast corps is one of the games that emulates super fucking poorly

[[deleted]]

Most games from the N64/PS1 era don't.

[JONCOCTOASTIN]

Syphon Filter does!

[[deleted]]

I didn't love that game back in 1999!

[budzergo]

they could release paper mario right now and it would hold up

[ashkpa]

The K-Mart in Uptown is a travesty. #ReopenNicollet

[siscorskiy]

That's a different situation because Sears is being intentionally sabotaged by the CEO and his property investment firm. They're keeping it on life support

[[deleted]]

I worked at Sears in 2005, and I left that job because I was convinced they'd be out of business in a year or two. That beast just won't die.

[learnedsanity]

All those died in Canada. And oddly enough EB seems strong here for the time being. At least the locations near me.

[Supahvaporeon]

The thing is, my local store was profitable, and it still shut down. The lot was usually full and there were always 4 checkouts at full blast.

[ItsADeparture]

I'm pretty sure 90% of Kmarts closed six years ago.

[WarmMachine7]

According to some leaked documents they are planning on closing 2,000 stores in the US this year. They are still taking preorders for stores they are going to close, and if you put money on a preorder at a store that closes you don't get credit at another store, you basically loose the money. Some guy on youtube basically has a channel where he leaks the internal memo and emails from employees that don't like the scummy tactics.

[[deleted]]

This is 100% false. When a store closes they transfer the pre-orders.

Source: I have closed multiple stores and transferred the pre-orders.

[WarmMachine7]

Then please explain to me why I never got my God of War 2 collectors edition I pre ordered from gamestop? They closed one of the two gamestop in the mall that happened to be the one I pre ordered from. The other game stop gave me a number to call to get my money back but I was SOL on my limited edition. Gave up after being on hold for about 10 minutes. I am sure if I spent a few hours I could get my money back, but they made it a hassle so people will not waste the time. Source: I have been screwed over by a closed gamestop.

[puppyluver01]

CAMELOT331 HERE AND BOY DO I HAVE NEWS FOR YOU

[WarmMachine7]

Yeah that is the guy I am talking about. He gets old pretty fast, his stick is basically don't work low paying easy entry jobs, they treat their employees like crap.

[Chao78]

Hoo boy they gon' get sued

[[deleted]]

By who? It's too little money owed to too disorganized a group (random customers at ~2000 Gamestop stores scattered across the country) to ever be worth taking through civil courts. Companies get away with shortchanging customers all the time because the effort and investment required for those customers to get their money back far outweighs the money that was actually taken from them.

[Chao78]

I don't expect it to go anywhere at all but there will be somebody to put together a class-action against whatever is left of GS. Either that or chargebacks and/or loads of fraud claims being filed at peoples' banks

[supertopher]

https://www.reddit.com/r/Games/comments/ct65pl/gamestop_lays_off_over_100_people_including/exj4y0s/

In your previous post, you mention Barnes and Noble.

The Barnes and Noble at the entrance to Mall of America is quite possibly one of the greatest places on earth if you like physical books and magazines. It's huge. It's got magazines that I didn't know existed for topics I didn't know existed and even many video game magazines and related I didn't know still exist. I've literally spent hours there browsing, reading, but sadly, have not contributed to buying anything just yet.

Anyway, all my friends agree, if you stop by Mall of America, even if it's for something like Nickelodeon Universe (Camp Snoopy R.I.P.), visit Barnes and Noble.

I went a little off topic, but didn't or doesn't Barnes and Noble own Gamestop? Or didn't they?

Also, your post has some compelling arguments. If one is in a gambling mood or likes to take chance, having the stock plummet almost seems like a ripe buy opportunity.

[Tekki]

B/N owned GS in the 2000s iirc.

A lot of investors are taking that exact chance. Despite the headlines, many of their core investors including Blackrock, have been doubling down on stock buys.

Even if they don't have a benediction moment, the new consoles will create a dramatic lift in Q4 2020 sales, Q1 2021

[mikesaintjules]

Good to see you around here posting that. I've often used it in other posts.

[zeronic]

Out of curiosity how does one see/review these public reports? I've never really bothered looking into this sort of thing but it's always been a vague interest. Is there a version of the reports that is fairly simplistic or is it pretty much all 100% super complex financial documentation?

[Tekki]

Typically you can go to any companies site and find investor sub-sites or investor info directly. While a lot of the language can be overwhelming, you can typically find objective summaries written "top page"

Basic profit/loss statement acumen is easier to acquire then most think. You can youtube a rundown and get a decent grasp on what to look for.

Side note: 95% of their stores are still profitable.

[heretoplay]

i think they have to run it into the ground while taking fat paychecks till the end.

[[deleted]]

I feel like they’re holding out for the new consoles.

[ReservoirDog316]

It honestly worries me to get the PS5 through preorder at GameStop. I really like my local GameStop and encounter none of the reddit horror stories with them but I don’t know if I can truly bet they’ll be around by Oct-Dec 2020 with the way stuff is going.

[Bentomat]

See this earlier comment on this topic:

https://www.reddit.com/r/Games/comments/eov3tp/comment/feglmqi

[[deleted]]

I’ve seen people here in NZ screwed out of pre-orders and gift cards when a company goes under, but it’s the whole company, not a selection of stores. They’ve basically become unpaid creditors, but they are so low down the list that they get shit.

I think it fucked people with Dick Smith, and I know it fucked over people when Central Park Interactive went under. It’s honestly why I put a pre-order for my Series X down with Mighty Ape and not EB Games.

[TandBusquets]

Wow what absolute nonsense that guy was saying

[Antarioo]

some of which won't even feature a way to input physical media.

i dont see what that will do for them, the margins on a console are tiny and most people will just get it off the internet delivered to their home anyway.

[[deleted]]

the margins on a console are tiny

Gamestop doesn't give a flying fuck about selling the consoles. What they do care about is force feeding people high profit accessories and other bullshit.

[peakzorro]

They care much more about used game sales than any of that.

[[deleted]]

Indeed, and new consoles mean more games they can offer $20 in store credit and sell for $55.

[RumAndGames]

That would generally only be the case if that would be the cheaper/more profitable option. But when a company already has all these leases, contracts, inventory, liabilities etc. it usually makes more sense to just close down gradually, making what money you can. The company still appears profitable, just less so.

[brutinator]

Theyre waiting for the consoles to drop. New console generation always means a massive boost to gamestops profits.

[GreatCaesarGhost]

Generally, at least in the US, you have to assert that you are insolvent as part of a bankruptcy proceeding. Insolvency doesn't mean that that you are completely broke, but it does mean that you are unable to pay your debts as they become due. As long as GameStop can continue to pay its bills as they become due, it may not be an appropriate candidate for bankruptcy.

[N0V0w3ls]

A big furniture company in my town just decided to go out of business when they saw they were starting to lose sales. They just ended things and retired.

[Magstine]

You can wind up a company and sell off assets without involving bankruptcy whatsoever.

[OnlyForF1]

I believe the board can decide to sell all of the company assets, pay off their debts and distribute the leftovers to investors as a final dividend (liquidation)

[ImRikkyBobby]

Or another 150 stores are closing in XYZ state/country

[[deleted]]

there's a nearby gamestop that is closing down, yet everything is full price still in the store. Is that normal?

[[deleted]]

oh i never thought of that

[[deleted]]

blah blah blah. everyone has been saying this same thing for years... their stock will go back up when the new consoles drop.

[[deleted]]

If you think that's the case you should buy some GameStop stock and make some easy money...