Ahead of posting their Q1 2016 results, Gamestop is forecasted to report falling earnings from last year. The international video game retailer is expected to take in 61 cents per share from revenue of $1.97 billion. This is slightly less than they reported this time last year – 68 cents per share on revenue of $2.07 billion, or a loss of about seven cents per share – but overall, the company’s revenue has steadily declining in recent years.
Apart from a decline in software sales, there are several probable causes for this. There are a growing number of customers who prefer to buy games as digital downloads for their PC or console of choice, not to mention the wealth of other companies to buy games from online, including several that offer better discounts and membership deals than Gamestop’s rigid prices.
Overall, The Street reports a C+ score for the company, with a rating of “hold.”
With retailers like Amazon in the online space continuing to eat away at the necessity of brick and mortar stores like Gamestop, their downward trend is hardly surprising. If the rumors of the new upgraded PS4 Neo launching later this year are true, the company’s 2016 fortunes could change, though, without taking steps to adapt to a changing market landscape, their future may well still be up in the air.
