GameStop reports flat holiday sales of $2.86B

Specialty retailer lowers guidance after announcing tepid end to 2009, shares tumble 15 percent; chain pins results on weak economy, bad weather, unexpected shortages.

After the gaming industry spent most of 2009 in a sales slump, the holiday season arrived with little to cheer about. Not even the release of Call of Duty: Modern Warfare 2 and its 6 million sold could prevent November US retail sales from finishing down more than 7 percent year-over-year.

GameStop managed to post holiday sales roughly equal to those of 2008, but failed to live up to its own expectations.

Analysts are also expecting a down December, but at least one retailer managed to match last year's holiday performance. For the nine-week holiday period ending January 2, 2010, GameStop reported total sales of $2.86 billion, practically even with the 2008 holiday season's take.

GameStop attributed the stagnant sales to a combination of factors. While there were a number of hit games released, the retailer said sales were tempered by a weak economy, winter storms that kept shoppers home during December's busiest days, and unexpected shortages of some products, specifically New Super Mario Bros. Wii, the Wii itself, and the PlayStation 3.

Joining Modern Warfare 2 and New Super Mario Bros. Wii as the five best-selling holiday titles for GameStop were Assassin's Creed II, Left 4 Dead 2, and Dragon Age: Origins. Those titles were part of the reason new-game sales increased about 4 percent for the chain.

Used-game sales also grew considerably, up 10 percent from the previous year. However, those gains were offset by reduced revenue from hardware sales, as fewer systems were sold, and they sold for less thanks to console makers' recent price cuts.

Given the tepid holiday season, GameStop lowered its expectations for its full year and fourth fiscal quarter of 2009 (the three months ending January 31). The company had previously expected $1.47 to $1.65 in earnings per share for the fourth quarter, but dialed that back to $1.25 to $1.29. As for the full year, the prior expectation of $2.45 to $2.63 was lowered to $2.23 to $2.27.

Investors reacted to the news negatively, as GameStop shares traded down sharply today. As of press time, the company's stock was going for $20.26, down nearly 16 percent from yesterday's closing price of $24.03.

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Discussion

111 comments
the_real_luigi
the_real_luigi

Then why are Game Stops Regional Managers jumping down there Store Manager's cases so much after the way sales went! It's unfair to the Store Managers because they can't MAKE customers buy stuff that they don't want or need! The Regional Managers need to CHILL OUT on their Store Managers and look at the facts first before pointing blame! They just want to point fingers and blame everyone else rather then the industry as in a whole!

enin
enin

Most people do have a problem with the Used-Game market, but if GameStop didn't sell used, they wouldn't make money. They only make about $5 at the most for any new game or console sold as the cost on those is so high, so they have to rely on trade-ins for all of their profit margin. Basically if they didn't have used games to sell, there would be no GS.

dgnr82cool
dgnr82cool

You can buy new at amazon and get free shipping for about 54 bucks, but gamestop charges you 54 bucks for some more recent TRADE-INS... Trade policy is garbage, prices are obscene, and there has NEVER been a hot chick working for gamestop. Seriously, would it kill them to get a couple of 8's at the most to work in each store? Must be against their policy or something, like you have to provide a photo with your application. "Nope, she's too hot, can't hire her." Ok, I know that last fact really has no bearing on gaming business, but I just thought it should be thrown out there. Everytime I walk into a gamestop it looks like the employees there just finished a rousing game of "magic the gathering" in the bathroom.

Rottenwood
Rottenwood

I've never understood all the trade-in complaints. People whine about not getting enough money for the trade, AND for used games being too expensive. Um, what? If they give you MORE money for a trade-in, they'd have to charge more as well to maintain a profit margin. Unless, of, course you'd like them to pay rent, utilities, payroll, and shrink out of their own pockets, and go under in six months. Used games are a dice roll. Who knows what might get stuck sitting on the shelf? Price drops with new product can be handled with the distributor, but used items are GameStop's problem. If they start paying $40+ for recent trade-ins and the game turns out to bomb, they'll end up eating thirty dollars or more per unit as they're forced to drastically drop the price just to recoup any money at all. Go to any GameStop and you'll see plenty of titles (often, mediocre shooters or short action games) in stacks of twenty or more on the shelf. The store is pretty much going to eat most of the money they paid for that garbage, while the customer was given half their money back despite their inability to do a shred of personal research. I actually detest the used game market, as it brutally undercuts developers and game publishers, but people hate it for all the wrong reasons.

sieg6529
sieg6529

I buy all my games on Amazon, because they're cheaper. However, I own stock in GameStop, so this still sucks.

mouthforbathory
mouthforbathory

You people act like you don't have a choice in the matter of selling and purchasing your games. Vote with your dollars. I used to work for GS a while back, many of my friends do, including one of my roommates who happens to be a manager. Honestly I could care less if the company went to hell in a handbasket. Sure my roomy would be out of a job there, but there are plenty of places that would want him, he's been offered managing positions before from competing retailers like Best Buy. The huge problem here is that GS is such a huge controlling factor in the games industry. While I always hope for actual game stores and box copies of games to exist, I do hope that the used game industry really just falls into Oblivion. The only games I buy used are ones that I know I can't get brand new from a retailer anymore, this includes PC games, since many games are completely unavailable now, and I much prefer to have a real copy of a game instead of a digital download most of the time, unless it's a good deal. No matter what, as long as you have a real copy of a game that you keep in proper condition or at least backed up on some external device (and I'm talking legally here, not illegally you ******* pirates) or optical disc then you can never lose it essentially. Even if Valve's Steam service goes completely ka-put, even still someone will find a fix or a hack to keep the games usable in some fashion. I like Direct 2 Drive as much if not more than Steam because game downloads are executables that don't require a background service like Steam to be run that must connect to the internet just to get it's offline mode turned on. I bought FEAR and Extraction Point from D2D when I absolutely couldn't find the game anywhere new or used at retailers. It's great that I can just back it up onto my external USB along with the serial key which I have saved as a notepad file sitting right next to the executables. This doesn't mean Steam is crappy. I will always like how straight forward it is, and the lack of me needing to pay attention to patches since it's done automatically for me.

NukeKnight
NukeKnight

To be hoenst Best Buy has better incentives then gamestop. even more so with their gamer rewards program they've started. I have saved a lot of money through their coupons and points system so I'd buy from them over gamestop nowadays if I want soemthign new. Used I'll go to GameStop if I can't get it cheaper else where. Also GamesTop lacks in the PC department nowadays and the one near me only recives enoug hcopies to satisfy the pre-orders and thats it.

Solid_Monkey
Solid_Monkey

As an employee of a gamestop I've seen it all. I've been cussed out for giving someone bad news about trade in values. To be frank it does get old. I don't understand why people get so pissed off. It's retail, there trying to profit. So of course there going to give you the lowest amount possible for trade ins. If gamestop gave full value or higher value than the company wouldn't be so huge like it is today. Just because I'm an employee doesn't mean I don't have my complaints. I work on the other side of the counter and I've seen people have over the top reactions. Not much people can do to change the company besides not shop there. I just wish people didn't take their anger out on me when I don't make up the trade in values. If you think gamestop is unfair and everybody that works there is a douche, than don't go there. Simple enough.

grnsuperman4
grnsuperman4

I used to go to Gamestop almost weekly. Being one of the only places that did pre-orders was an edge they used to have. Its the prices of newer used games and controllers that turns me off to them. They give a max trade in of $30 and then sell it for $55? You can usually find it new on sale somewere for $10 off. It just doesn't make sense to me to buy it used for only $5 off. Toys"R"Us has been struggling in recent years and they carry items you just can't get anywere else. So if I'm going to spend full price I go there. Vote with my dollars so to speak. Having a bajillion kids like I do, Toys"R"Us is invaluable to me. I only go to Gamespot now to find cheap deals on older used games. It's the only place you can get old really good games for under $20. Seen Mass Effect for like $12. Lost Planet was like $8 when I bought it. If the normal price for used newer games was $49.99 I could see myself buying them. Then I could at least walk into any Gamestop and get a used copy for the sale price of a new copy and skip the searching adds. The main turn off for me has been customer service though. Were do they get their employees? Anti-social live in moms basement with no register skills emporium? I even had one salesperson insult me out of the blue. Maybe it's just one of those few employers that doesn't care how you look or how you treat your customers. Best Buy, Target, Toys"R"Us, and even Wal-Mart have better customer service.

TheKokopelli
TheKokopelli

I have been going to Gamestop, previously EB, previously Software Etc since '95. I have yet to have a problem with them and I frequent several of their stores. If you have a complaint about the price of the game, take it up with the publishers. The rest of the stores charge the same amount for a new game, and often charges more for an old title than what GS is selling it new. If you have a complaint about getting $30.00 for a new trade in, then hold off until you can get it used. Then buy it, beat it, and return it in 7-days. If that doesn't work, then EBay your old games and see what you can get for them.

Starvnmrvn
Starvnmrvn

To all those thinking that Play N Trade gives you more money... You're wrong. They just WON"T take your game if they have too many. Complain all you want but for most of your broke asses gamestop is the only company that gives you something back for your old games otherwise you just let them sit there. And Play N Trade matches gamestop prices...I have a friend that works there and I watched him go on gamestops website as the other guy looked at the price and printed the same prices for the games...pathetic. In all nobody can bash gamestop, you all keep going there no matter what even if you hate them so much. By going to the store you get the satisfaction of getting your game NOW instead of a tomorrow. Besides not all gamestops are bad, too many stores give the other ones bad views which sucks. And seriously...why the heck do people think they will get full value of a game that is over 2 years old? Gamestop needs to make a profit from that game. I can 100% agree though that gamestop stiffs ya on new release trade ins by giving you a max of 30$ for a brand new game that came out a day ago when you spent 60$. But honestly, you would do it differently? They broke even from last year...that's bad no matter what the economy is like. People need to make money.

phattgurl
phattgurl

i like gamestop, but i usually dont traede my games in, and they do rip you off so the only time i buy a used game is if i can beat it and return before the weeks up. Just dont buy used games and youll be stickin it to them instead, thats where they make all their cash

fon1988
fon1988

I wish this stupid company would go out of business already. They make half their money by screwing their customers in video game trade ins. Walmart and other retailers receive new games before Gamestop all the time, so this company is pretty much useless.

mijahi
mijahi

I don't know...I must live in the area GameStop is doing well in. We have 6 stores in a city of only about 350K. Heck, 2 pair of them are less than half a block from each other...one pair even shares the same parking lot! I guess I can understand the issues some might have with them, but I've never had any problems in my dealings with GameStop. I always buy used, the staff is always super helpful, I am allowed to check the condition of every disc before I buy it...they'll even call other stores in the region to have a certain title shipped to me and call to make sure it is complete before I pay! Good folk in my opinion. I guess my only complaint is that they don't carry the legacy platform games, but I have other stores in the area for that, so... Though I will admit the anti-capitalist in me scoffs a little at the fact they're upset over only making $2.86B. I mean, seriously?!

LordRaymond
LordRaymond

They are still making a profit unlike many buisness today so it doesnt matter to the general public. Also because they don't have the 2010 PS3 game lineup! plus some highly anticipated multiplatform games.

justhat1
justhat1

first off refrain from showing your lack of common knowledge,gbpacker,andpukemon please don't be forum thugs.i can only speak about the g.stops in ny and the games that are factory wrapped (brand new) are behind the glass case behind the cashier now if they take a game from the draw after they've taken it home for a few days to play it, a common gs practice(check your facts) how is that a new game?also as far as stealing a game that would be impossible since the games are once again behind the counter,so who really is the IMBECILE! this is a public forum and granted at times you will have people who just want to start drama well i dont respond to kids, you are entitled to your opinion but save the name calling for somebody that cares.!!!

HardCor1981
HardCor1981

@johnryandaplin You are so right! I stopped buying from mall videogame stores a few years ago! E-bay every time...I save $20/game by cutting out the middle man. I still don't know why people pay more money so that they are the ones to get to pull off the saran wrap.

johnryandaplin
johnryandaplin

if they want sales then maybe they should start SELLING IT MORE CHEAPLY, gamestop are f***** robbers

Threesixtyci
Threesixtyci

I suspect the main reason this has happened is because I haven't bought any PS2 games... and others like me. With no new PS2 games being released and all. That, and Steam's holiday sale...

JHKHLUJNM
JHKHLUJNM

Actually gamestop sells more videogames than target or walmart, second of all most used games that are new trade for 20 to 25 dollars no way your local retailer can do that if they are selling it for 20. Secondly if a company has 15000 copies of a game used nationwide and the used ones arent selling and gradually losing value the the trade amount goes down because of lack of demand, the sales price however must compete with the new price because of pressure from game developers and manufactures otherwise they undercut new sales and would lose publisher backing, thats why a mom and pop store can do that because they dont effect the industry. BTW gamestop started the entire trade in program for games that now the little guys copy. You used to have to keep all the crap you didnt like or want. spoiled brat. yours truly Proud Gamestop Manager

Mattius04
Mattius04

Thats because no one wants to shop at Gamestop because they rip you off on used games. I can buy used new release titles for $20 cheaper at a local game store compared to their $5 difference. What a joke! Also, another lesson to learn in life is to never sell them your newer used games, they will give you $6.95 for it and sell it for $54.99. Ouch! Smarter people with common sense would stay away from this business. The only reason I would buy a used game from there is if someone put a gun to my head and said.."Buy a used game now!!!"

LavisBlade
LavisBlade

Honestly GameStop does terrible marketing. They are competing mainly against Wal-Mart, Amazon and Steam and in all honesty they are the weakest of the group competitive wise. Amazon and Wal-Mart are cutthroat at slashing prices with one another and Steam does amazing sales no retailer could do and uses a unique (better) platform for distribution, but they are limited to PC gaming.

mellow09
mellow09

@ vectorman88 Not to defend GS or anything, but why would they give you much, if any money for PS2 games? The odds of them selling them are slim now. Plus they are old and probably cost well under twenty bucks not (especially sport games). And The Darkness, while a great game, sells at 8 dollars. What do you expect to get 4-7? Why, they probably won't sell that game. GS gives you the chance to get something from these things, you have no need for complaining about not getting more. P.S. You need to watch their trade in deals when you've got older games. Sometimes you can get an extra 10-50 dollars for your trade ins, no matter the game. That's when you go in, or at least when I do.

IRISH_VANDAL
IRISH_VANDAL

Gamestop has never given a fair trade-in price anytime. I prefer holding onto my older titles and Grinding out the full game itself than passing it onto my kids. Edge card and buying used honestly is the best way right now for hardcore gamers to enjoy more titles. This economy has me pin and gaming is my silent release. May every gamer enjoy a Happy and Prosperous New Year. XBL: IRISH VANDAL

vectorman88
vectorman88

talk about strange. These guys were the primary carriers of Modern Warfare 2. Wouldve thought that it would have had a big increase over last year. Guess there's more that happens behind closed door then we know. Gamestop isnt bad. Sometimes they have good price drops and used deals. I picked up Flashpoint for $40 last week. However, i have lost a great deal of faith in them regarding their used game policy. I went and brought The Darkness to put towards my MW2 pre-order among many PS2 games. Turns out- NOTHING and I mean a good number of games, NOTHING was valuable. Not even The Darkness which was a pretty good Story FPS released in 2007 (def try it out). They cited some co-porate crap but now I go to Play N Trade.

sleepydude231
sleepydude231

I know someone who works for gamestop and the open "new" products have been played by employees. Also, take comfort in the fact that in 10 years gamestop will be obsolete, with everything being digital download.

Colepachi
Colepachi

For those who believe all the new games taken out of the cases are new. I bought one of these supposedly new games off the shelf. The game was opened of course because it was just the box with no game in it. When I brought the game home I pulled the price tag off the game case and there was a used sticker behind the new sticker. I could of gotten a used game and paid the extra money for a new copy. That is a ripoff! For those who think the empty displays are to keep people honest. Back in Sega Genesis and Super Nintendo days Toys R Us had the cards you grabbed off the shelves then you took it to the front counter and they gave you your game. Boycott this dishonest company.

Godak
Godak

If GameStop is unhappy with their 2.86 billion dollars, I'll gladly take it off their hands.

d_kell411
d_kell411

@ Humorguy_basic Hah I could not agree more...however your example is slightly different. This article focuses specifically on Gamestop sales...so if we were to use your example it'd be...for example...Ford. Gamestop also marketed an extraordinary shock and awe campaign surrounding MW2...they put all of their eggs in one basket. If Ford focused all of their marketing assets on the Focus model alone...and the Focus broke sales records that year...then it would come as no surprise that the rest of the company did poorly. Gamestop dropped all of their eggs into one basket...and even though it helped MW2 break record sales, in the end it just took away from the rest of their products.

slainta
slainta

I thought the PS3 sold 3.8 ml consoles in the holidays. What weak economy? Many people still have plenty of money. Maybe GameStop should consider to revise its price(y) policy?

Humorguy_basic
Humorguy_basic

How juvenile can the media be? Sales down 'despite MW 2 selling 7 million'. Can you imagine a media report on the car industry talking about being surprised that car sales overall were down given one particular car model doing well? I am amazed at the amateurism of our gaming media!

johnnybravo87
johnnybravo87

Gamestop isn't customer friendly, they have so much rules and ridiculous trade in, I remember buying a brand new game at its release and wanted to swap it out for a different console and the trade in value drop 35 bucks. (RIPP OFF) there return policy and warranty is a joke. Walmart offers a 1 year warranty while gamestop wants $$$ for warranty and most of the time don't offer none. Gamestop needs to work on being more reasonable.

pukemon
pukemon

they're enforcing box, art and instructions and if it looks new, wrap it and sell as new. everybody should start talking with their wallets and shop elsewhere. gamestop is a scam.

HappyApryl
HappyApryl

oh by the way, I read in a post way at the bottom about gamestop not taking trade ins without case, art, and instructions....and then someone bashed him....all the game stops around here are doing the same thing on any of the current gen systems....ps3, psp, 360, wii, ds....I only found out because some kids next door tried to take their games back and gamestop wouldnt take them because they lost the instruction manual, you should see their room lol. hurray for ebay!!!!!!!! I explained to them they would get more if they sold em on ebay anyways.

pukemon
pukemon

GBPackersrule Posted Jan 7, 2010 10:19 pm PT @justhat1 The games are new imbecile! They take them out of the case so that retards like you don't steal them off the shelf! I weep for the future... u r sofa king we todd did.

devildothack
devildothack

@SalarianChemist i completely agree with you. i had problems with laptops, printers and some graphic cards that i purchased at best buy. they would not honor my warranty and yes, i read the full warranty before i sign. they gave me phone numbers to call technical support and even them, they told me my problem wouldn't be fix, that the device had to be replace. bestbuy send me up and down, until ask to speak with a manager. i fill out some stupid forms to get my money back and to this date still waiting. i stop doing business with them altogether, i shop my electronics with compusa..very economical, almost newegg prices and excellent service (young guys work there that actually love technology and eager to help)

HappyApryl
HappyApryl

oh well gamestop, if only more folks would fallow our footsteps of NOT SHOPPING there because of how bad your trades are. I feel for the kids that just dont understand how bad they are getting ripped off....here's to wishing this year you see some more drops in sales, hehehe....go go amazon, ebay, newegg, and even bestbuy.

Accuracy158
Accuracy158

When I go to buy a game GameStop is the last place I like to shop at.

BoondockSaint22
BoondockSaint22

I know what lead to weak sales! maybe modded boxes since so many people were banned lmao

GBPackersrule
GBPackersrule

@justhat1 The games are new imbecile! They take them out of the case so that retards like you don't steal them off the shelf! I weep for the future...

GBPackersrule
GBPackersrule

@justhat1 The games are new imbecile! They take them out of the case so that retards like you don't steal them off the shelf! I weep for the future...

justhat1
justhat1

you only make 2.8billion and you complain? gamestop is a poorly run francise, yet they continue to rob gamers because gamers need to do less talking with thier mouths and more with thier wallets. take your hard earned money and spend it else where,thats the only way you will get thier attention.if i come into your store to buy a new game,then why doesn't it have factory wrapping but you go in the draw and take it out and put it in the case news flash thats not a new game,also i trade in 5 to 10 games and get back if i'm lucky 8$ thats called robbery.in the end all i'm saying is instead of venting at gamestop,make a choice i haven't spent money in gs in years because i made a choice to stop being ripped off. you have the power to do the same.REMEMBER CHOICE!

pukemon
pukemon

Your issues seem to stem largely with the Home Theatre department. Home Theatre is a vastly different experience and has little to do with gaming. Home Theatre also has a LOT to do with what sales associate you get. For every associate telling you to buy their overpriced cables, you'll find an associate telling you they're a rip-off. There is no Best Buy policy telling its employees to LIE to its customers, as you imply. In fact, were a GM or OM to know about what that associate told you regarding the HDMI cable, he would have been reprimanded. And if he had the misfortune to do that to a "mystery shopper," he'd've been fired. Also, sorry that you feel you got burned on the service plan, but many people expect more out of Best Buy warrantees than they should get. The only time your product will EVER be replaced and not repaired is if you've brought in that product three times. That's the "no lemon" policy. Other than that, whether or not you'll get a new HDTV depends on whether the repair depot determines that repairs would be more expensive than replacement. These facts are NOT hidden. And if physical damage is involved, you're all out of luck. 99% of beefs with Best Buy/Future Shop over warrantees are bunk. It's almost always a case of people not knowing the details of the warrantee they bought before they bought it. what have you been smoking?

slaxl
slaxl

@aaronfhff123 - i agree with you bro - nothing even to this day can compare to Goldeneye and especially Perfect Dark on N64 - me and my cousins - god DAMN - all those sleepless unrested nights of playing that beautiful game.

DarKage13
DarKage13

I don't often buy from Gamestop because I don't usually have the money to buy new games, but when there is a game that I really want, and they have it used, if I don't want to wait a few days longer to get it, then I tend to buy from them, otherwise I go to Gamecrazy.

lamprey263
lamprey263

Not to attack rhythm games because I think they're fun to some degree, and they sell a lot, but I often wonder how much something like a full Rock Band set takes up in any GameStop store's storage space, which I can't imagine is very big because all the stores in my area are rather small, after all you could store 100 $60 titles in the same space as one RockBand set with drums and guitars and everything that goes for anywhere between $100 and $200. Economically it would make sense not to carry the $200 item for making room of the $6000 worth of merchandise, but then again if GameStop didn't carry this it might turn gamers away for not stocking it. I only bring this up because they mentioned game shortages in stores as a loss to GameStop revenues, which I assume is due to limited space to carrying each and every game. Of course, from a management standpoint each store can just order more, like when I show up to a GameStop they tell me they're out and they'll order more; in those cases I just go somewhere else that will have it like Target or Bestbuy. Surely that cuts in on revenues, that's why I think they need to order more copies of a game than just to cover pre-orders, if they don't sell those copies just ship them back to the distributer later.

aaronfhff123
aaronfhff123

@1penance1 My idea of a good game: Goldeneye and Perfect Dark on the n64, all the halflife games, and all the metal gear games. When it comes to Call of duty? I would have to go with W@W.

Paladin_King
Paladin_King

gah...apparently GS won't let me break up that paragraph.

Paladin_King
Paladin_King

@SalarianChemist I worked at Future Shop for two years. Your issues seem to stem largely with the Home Theatre department. Home Theatre is a vastly different experience and has little to do with gaming. Home Theatre also has a LOT to do with what sales associate you get. For every associate telling you to buy their overpriced cables, you'll find an associate telling you they're a rip-off. There is no Best Buy policy telling its employees to LIE to its customers, as you imply. In fact, were a GM or OM to know about what that associate told you regarding the HDMI cable, he would have been reprimanded. And if he had the misfortune to do that to a "mystery shopper," he'd've been fired. Also, sorry that you feel you got burned on the service plan, but many people expect more out of Best Buy warrantees than they should get. The only time your product will EVER be replaced and not repaired is if you've brought in that product three times. That's the "no lemon" policy. Other than that, whether or not you'll get a new HDTV depends on whether the repair depot determines that repairs would be more expensive than replacement. These facts are NOT hidden. And if physical damage is involved, you're all out of luck. 99% of beefs with Best Buy/Future Shop over warrantees are bunk. It's almost always a case of people not knowing the details of the warrantee they bought before they bought it.