GameStop Releases Business Update Discussing COVID-19 Plans, Effects

On April 21, George Sherman, GameStop’s Chief Executive Officer, made an official statement discussing the company’s efforts to slow the spread of COVID-19 as well as the effects which the global coronavirus pandemic have had on business. Sherman’s comments were optimistic and forward-looking, congratulating staff on their efforts while discussing positive sales trends despite the uncertain situation.

“I am very proud of the resilience that our teams are showing during this time,” praised Sherman. He went on to detail how two-thirds of US GameStop locations have continued to serve customers by moving to a “curbside pickup” model. The CEO considered these efforts to be a success, reporting that “we have retained over 90% of our planned sales volumes in the two-thirds of our stores that are conducting curbside operations. We believe this speaks to the strength of our enhanced omnichannel capabilities implemented in the fall of last year.”

GameStop was previously a source of controversy as the US began implementing lockdown and quarantine restrictions in mid-March. GameStop’s attempt to claim that its stores were “essential retail” and thus should remain open received significant criticism on social media and in the news. Ultimately, GameStop rescinded their claim and closed the majority of their stores on March 22, with the open locations switching to the curbside pickup only model.

In addition to Sherman’s positive update, GameStop’s press release outlined additional measures which they will be taking in the upcoming weeks. Some of the highlights include:

    • Sherman will be taking a temporary base salary reduction of 50%, with other executive staff members taking discounts of between 10 and 30%.
    • Inventory receipts will be reduced and updated to reflect the demand for crucial hardware and software (speculated to include Nintendo Switch consoles and popular titles such as Animal Crossing: New Horizons).
    • Capital spending will be lowered to focus on short-term maintenance and strategy.
    • Temporarily reduced hours or furlough options will be available to GameStop employees around the world.

While many businesses have suffered, GameStop’s sales have surged due to the increased demand for video games as the perfect “indoor” and “socially distant” source of entertainment. The press release stated that GameStop is confident in its ability to weather any potential financial crises, as “it has sufficient liquidity and financial flexibility to navigate the current environment.”

Although things are looking pretty optimistic for the game retailer, the press release does end with the following language: “Forward-looking statements contained in this press release speak only as of the date of this release. The company undertakes no obligation to update any forward-looking statement publicly.” This may indicate that GameStop will not be so forward if their financial situation or sales do experience a decline.

In addition to this statement, GameStop has remained highly active on Twitter. They have been strong supporters of the #PlayApartTogether initiative, which emphasizes games as a method of staying connected during these uncertain times.

What do you think of GameStop’s latest update? Have you tried out their “curbside pickup” service? What do you think of it? Let us know!

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