The floundering video game retailer GameStop is having themselves a wonderful day, as their stock prices have increased by a whopping 18%.
As the world continues to become further entrenched into the Digital Age, yesteryear formats will continue to die off. In the case of video games, this means physical copies. Digital copies and/or video game codes are the future of gaming whether we like it or not, and naturally GameStop has been in a relatively sharp business decline as digital games rise in prominence.
GameStop has also hastened its own demise, after word broke out about GameStop’s horrible ‘Circle of Life’ policy. Couple that with numerous testimonies from ex-employees about poor treatment, bad pay, and wretched corporate politics, and most gamers are at the point where they will cheer when GameStop goes out of business.
GameStop’s stock has seen a 26% decrease from last year’s high, but today they have made quite the last-minute comeback. GameStop announced that they will be selling Spring Mobile to Prime Communications for $700 million. GameStop acquired Spring Mobile back in 2014, and at that time. Spring Mobile operated around 150 AT&T Wireless stores across the country. That number as of the sale to Prime Communications is 1,289 stores. After the announcement was made and the stock market resumed, GameStop’s stock saw a spike of 18%.
In a press release about the sale, executive chairman Dan DeMatteo, had this to say:
“This transaction enables GameStop to enhance our performance with an increased focus on the video game industry and the rapidly-growing collectibles space,”.
Whether or not making substantial additional investments into the video game industry being a good idea on GameStop’s part is anyone’s guess, but allocating funds to the collectibles space is a smart move. There will still be plenty of gamers out there who will collect physical copies of video games, but it’s highly unlikely that there are enough to keep GameStop afloat. Collectibles however, such as Funko Pop and Amiibo, are extremely popular and won’t be going anywhere anytime soon. GameStop’s exclusive Funko Pops are highly sought after by collectors, and this niche definitely has a lot of growth potential.
GameStop bought themselves some breathing room with this move, let’s see what they do with it.
