GameStop fires 120 corporate employees as stocks continue to plummet

The large video game retailer GameStop has announced the layoff of 120 employees, representing a 14% reduction in "the company's associated workforce at our company headquarters and in some other offices."

"While these changes are difficult, they were needed to reduce costs and better align the organization with our efforts to optimize the business to meet our goals and success factors ahead," said GameStop. in a statement. "We recognize that it is a difficult day for our company and especially for the affected associates, and we appreciate their dedication and service to GameStop and we are committed to supporting them during this exciting time. transition period. "

It is not known if this number includes GameStop magazine's Game Informer staff. a lot of who take from Twitter aujourd & # 39; hui at share news of their unexpected layoffs. Of the 19 staff members listed on the magazine's credits, at least six have been fired today, Editor-in-Chief Matt Bertz.

"I appreciate all the love," said today Game Informer editor Andy McNamara. "I see it – I feel it – I try to do it right with my people – I love Game Informer, its collaborators and readers, more than any company could, and I will deal with all the questions when I now I have to focus on my GI family. "

Can the sinking ship be raised?

Layoffs continue to be a big news for GameStop, which maintains more than 5,000 storefronts in 14 countries. After the company announced that it had failed to find a buyer in January, it recorded a huge quarterly loss in April, causing its stock to fall to its lowest point since 2005. Since then, Gamestop has seen its chief financial officer and chief of operations leave, instituted layoffs of 50 "leaders in the field" and closed its subsidiary ThinkGeek collectibles.

At the time of writing this article, the GameStop stock is trading at $ 3.42. This represents a decrease of 17% compared to the previous month, nearly 80% compared to a year ago and almost 94% compared to the peak reached at the end of 2013.

In June, GameStop's new CEO, George Sherman, presented a three-point plan, "Reboot", to help turn around the situation at the troubled retailer. The first point of this plan was "sales, general and administrative expenses", which appear to be the target of these recent layoffs. The other two points involved "optimiz[ing] the current activity ", partly thanks to better prices on the occasional games, and" develop[ing] new sources of revenue for the future ", including greater involvement in digital sales and" immersive interactive experiences ", whatever that means.

These types of changes may not be enough to protect GameStop from the seemingly inexorable movement of downloads and internet feeds that claimed other physical media retailers like Suncoast and Tower Records. In any case, we imagine that the tightening of the GameStop gaming belt will worsen before any potential reversal begins to appear.