GameStop Reports Record-High Sales for 2010

[Andy Chalk]

GameStop Reports Record-High Sales for 2010

GameStop [http://www.gamestop.com] reports record-high sales of nearly $9.5 billion for its financial year, driven in part by substantial growth in digital sales on both consoles and the PC.

The digital future looked to be an ugly one for GameStop, especially in light of what happened to Blockbuster [http://www.escapistmagazine.com/news/view/107959-Blockbuster-Wants-to-Put-Itself-Up-for-Auction], the once-mighty movie rental behemoth that recently declared bankruptcy. But don't shed any tears just yet, because based on its financial results for the 2010 fiscal year, the company is doing just fine, thanks.

GameStop rang up record-high sales of $9.47 billion for the year ending January 29, 2011, a year-over-year increase of 4.3 percent, with profits jumping 8.1 percent to reach $408 million. GameStop's experiments in the digital market appear to be paying off particularly well, as digital sales surged by 61 percent to $290 million for the year.

"Our innovations in e-commerce, digital offerings and PowerUp Rewards helped drive record sales, earnings and market share," said GameStop CEO Pail Raines. "Our focus in 2011 is to build on the success of our PowerUp Rewards program, expand our used business and increase our digital revenues, all while delivering strong financial results."

Used game sales totaled $2.47 billion, an increase of $75 million over the previous year and a hefty chunk of the overall business, but actually shrunk as a percentage of sales because of the dramatic increase in digital revenue. That's good news for the company, as digital sales become an increasingly accessible and attractive option, forcing GameStop to find some way to compete with online retailers.

"We believe this is a notable achievement as the company seeks to diversify its revenue base and take share online as a digital aggregator," said Lazard Capital Markets analyst Colin Sebastian. "Even assuming slower growth in digital going forward, digital should represent a half billion-plus revenue opportunity for GameStop within the next two years."

And for another year, at least, I'll still have a place to buy my boxes.

Source: GamesIndustry [http://www.gamesindustry.biz/articles/2011-03-24-gamestop-reports-record-high-sales-for-2010]


Permalink

 

[Onyx Oblivion]

I am one of sixteen people on this site who views this news as a good thing.

They're digital strategy is basically redeemable codes...But I can't see anything else they can really do, considering the way console DLC purchases work.

 

[JeanLuc761]

I am one of sixteen people on this site who views this news as a good thing.

The hatred against Gamestop can't be that bad...can it?

Either way, I see it as good news as well.

 

[The Rockerfly]

Recession? What recession?

I'm from the UK so I have no idea but I guess they are the US equivalent of GAME if so, yeah well done guys

 

[Souplex]

Why Gamestop!
Digital Distribution may be profitable, but it's inherently evil.
You were one of the good guys of the industry, don't be like Valve!

 

[therandombear]

I am one of sixteen people on this site who views this news as a good thing.

They're digital strategy is basically redeemable codes...But I can't see anything else they can really do, considering the way console DLC purchases work.

I like Gamestop aswell, never met idiots who didn't know what to do there always been people who knew what they were talking about.

 

[Shycte]

Oh, what is that? I thought everone thought that Steam was killing GameStop. Looks like DD isn't all that much.

 

[DTWolfwood]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

 

[thepyrethatburns]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Before or after the gamer had to buy a quarter of the game as DLC?

 

[JeanLuc761]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

 

[Something Amyss]

Oh, what is that? I thought everone thought that Steam was killing GameStop. Looks like DD isn't all that much.

That would be a much better comeback if a large portion of their success here has been attributed to digital sales. You know, DD. It looks like DD is all that much.

What it does look like is "Project Ten Dollar" ain't exactly killing GS, either.

 

[Something Amyss]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

Well, technically, he hasn't made the argument yet. He merely asked a lead-in.

 

[Blank Kold]

Oh, what is that? I thought everone thought that Steam was killing GameStop. Looks like DD isn't all that much.

I don't think that gamestop usually even carries very many pc games.

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

It's not unique to the video game industry. The fact simply is, people are vindictive about shit that doesn't really matter.

But stores that specialize in games, such as gamestop, require additional revenue from used games, bought back far, and i mean far, cheaper than the $40.00 to $50.00 dollar wholesale price.

 

[Regiment]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

The developers got a percentage of the original sales. Used games never sell for as much as new ones. Assuming a used game costs half as much as a new one and assuming that a quarter of the price of a game goes to the developers, the devs made $1 billion on the original sale of the games.

So, the devs got none of the money from used sales, but they made $1,000,000,000 the first time the games were sold.

 

[Krion_Vark]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

It isn't much different the only thing that I hate about Gamestop and their used games is on launch day they have games for $5 cheaper under the USED game. Also another thing that I don't like about a lot of game stops is that they gut new games. Neither of the two gamestops I go to do this so it isn't a big deal for me. But pretty much the thing is that I buy a new game so that I am the one that opens it and I know that I am the first one to touch it so that any problems with it are the game itself and not something that happened while it was getting stored in the envelopes by the employees.

 

[The Youth Counselor]

I just bought stock in the company.

 

[GonzoGamer]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

They used to be the same thing. That was until Gamestop started gathering a monopoly on used game retail and started gouging the price so that a used game is only a $1-2 savings from a new copy. Nobody cared about used game sales when they were being sold for $10-15 on average because those people buying titles at that price would either not have been able to afford a new game in the first place (they wouldn't have made a sale anyway) or would still have enough money left to buy a new game as well.

You look at books, movies, music, or cars and you'll see that there is a much bigger difference between the new price and the used price.

 

[Sixties Spidey]

I am one of sixteen people on this site who views this news as a good thing.

The hatred against Gamestop can't be that bad...can it?

Either way, I see it as good news as well.

Considering how much GameStop has grown in inverse proportion to their savings on a used game (think, 2 bucks.), I see this as the reason why incentives like Project Ten Dollar exist today (apart from, you know, stingy gamers and an even stingier company).

Also, allow me to deliver a personal message to the ass-hat who thought GameStop Exclusive DLC was a good idea: FUCK YOU.

Greetings from Dubai.

 

[constantcompile]

Used game sales totaled $2.47 billion

so what part of that went to the developers who made the games? just curious.

Until someone can explain to me why video games are in any way unique relative to used cars, books, movies or music, this argument holds absolutely no weight for me.

Whenever you see the "how much went to the developers?" Question brought up, the author is usually asking "how would my pirating the game have been any worse for the industry than buying used?"

If you interpret that as an argument for piracy, well, what weight it has depends on what stance you hold. If you interpret it as an argument against Gamestop, there's plenty of weight.

The argument for buying new in order to help perpetuate the jobs that generate the product is by no means unique. Buy new cars in order to help the economy even though used cars are a better deal, buy the book to support the author even though you can borrow it from the library for free, watch the movie in the theater to help box office performance even though you could just catch it on Netflix a few months later, etc. etc.

I think the argument is against all retailers that buy used goods very cheaply and sell them at very high prices; they are basically only putting money into their own pockets. Are these retailers really worth supporting? I'm sure that people who utilize their Library, Netflix, Gamefly, Steam etc. would say no, and I'd be inclined to agree with them. Retail is, by its very nature, inefficient. And because waste is one of the worst consequences of capitalism, I'd like to think videogames can help lead the way in making the world economy more efficient. And, I'm sure, this also holds true for most people on the Escapist.

But perhaps most simply, you're on a website frequented by people who love videogames. I'm sure there are many videogame studios that could have really used a chunk that 2.47 billion, and that many more great videogames could have been made if they had access to it. If that's the argument, why disagree?